Sensex, Nifty remain firm in late afternoon trade

The local benchmarks remained firm in late afternoon trade, aided by IT, TECK and Oil & Gas stocks, while investors awaiting Standard & Poor’s (S&P) India’s sovereign ratings review which is expected to release today. Traders continued to take encouragement with the report stated that the slowdown in the economy has bottomed out, and going forward, the pace of recovery will depend on initiatives the government takes to boost growth momentum, especially private investment. Some support also came with Credit ratings agency, Crisil Ratings’ latest report that in India bank credit to the micro, small and medium enterprises (MSME) sector, whose current market size is estimated at around Rs 14 lakh crore, is likely to expand at 11% compound annual growth rate (CAGR) over the next two financial years. The markets participants paid no heed towards the Manufacturers’ Association for Information Technology’s (MAIT) statement that the government’s Make in India electronics plan will be hurt by high GST rates, as the industry has found that the import of such electronics is cheaper than manufacturing them locally.

On the global front, European markets were trading mixed, as investors were eyeing the release of German business climate data due later in the day. Asian markets were trading mostly in green. Back home, in scrip specific development, Indian Hume Pipe Company jumped higher after the company secured work order of Rs 119.73 crore from Public Health & Municipal Engineering Department, Govt. of Andhra Pradesh - Ongole Municipal Corporation, for providing Water Supply Improvements Scheme under AMRUT project.

The BSE Sensex is currently trading at 33708.87, up by 120.79 points or 0.36% after trading in a range of 33639.98 and 33738.53. There were 17 stocks advancing against 13 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in green; the BSE Mid cap index was up by 0.64%, while Small cap index was up by 0.61%.

The top gaining sectoral indices on the BSE were Consumer Durables up by 2.81%, IT up by 0.99%, TECK up by 0.90%, Consumer Disc up by 0.73% and Oil & Gas up by 0.68%, while Metal down by 0.55% and Basic Materials down by 0.15% were the only losing indices on BSE.

The top gainers on the Sensex were Infosys up by 1.99%, Mahindra & Mahindra up by 1.11%, ITC up by 1.10%, Bajaj Auto up by 0.91% and Power Grid Corporation up by 0.91%. On the flip side, Tata Motors - DVR down by 0.76%, Wipro down by 0.63%, Hero MotoCorp down by 0.51%, ICICI Bank down by 0.50% and Tata Steel down by 0.47% were the top losers.

Meanwhile, raising concerns over high tax rates under Goods and Services Tax (GST) regime for some electronic items like printers, monitors and data cables, the Manufacturers’ Association for Information Technology (MAIT) has said that the government’s Make in India electronics plan will be hurt by high GST rates, as the industry has found that the import of such electronics is cheaper than manufacturing them locally.

The industry body which represents India’s IT hardware sectors and certain manufacturers, further expressed need to put all the IT products in one slab, against different tax rate for the pre-assembled desktops, locally manufactured standalone monitors and data cables. It requested the government to look over this anomaly and further made a case to put IT goods under 18% rate slab considering the importance of IT in government projects. Under the new tax regime, the pre-assembled desktops are charged at 18%, while standalone monitors which are mostly manufactured in the country are charged at 28% , while creating anomaly, desktop computers are imported into India at zero percent and have been put at 18% rate.

MAIT said one slab rate for all IT goods will help local manufacturers build products and contribute to the cause of Digital India.  MAIT praised the government’s Make in India initiative but raised need of concrete policies for the initiative to lessen the burden of imports.

The CNX Nifty is currently trading at 10394.65, up by 45.90 points or 0.44% after trading in a range of 10362.25 and 10404.50. There were 33 stocks advancing against 16 stocks declining on the index, while 1 stock remained unchanged. 

The top gainers on Nifty were Indusind Bank up by 2.23%, Infosys up by 2.18%, Aurobindo Pharma up by 2.11%, Bajaj Finance up by 1.70% and HPCL up by 1.69%. On the flip side, Hindalco down by 1.37%, Vedanta down by 0.84%, Wipro down by 0.82%, ICICI Bank down by 0.64% and NTPC down by 0.64% were the top losers.

Asian markets were trading mostly in green; Shanghai Composite increased 1.9 points or 0.06% to 3,353.82, KOSPI Index increased 7.18 points or 0.28% to 2,544.33, Nikkei 225 increased 27.7 points or 0.12% to 22,550.85 and Hang Seng increased 158.38 points or 0.53% to 29,866.32. On the flip side, FTSE Bursa Malaysia KLCI decreased 6.73 points or 0.39% to 1,714.54, Jakarta Composite decreased 2.7 points or 0.04% to 6,060.55 and Taiwan Weighted decreased 0.48 points or 0% to 10,854.09.

European markets were trading mixed; France’s CAC increased 2.07 points or 0.04% to 5,381.61 and Germany’s DAX increased 2.58 points or 0.02% to 13,011.13. On the flip side, UK’s FTSE 100 decreased 7.36 points or 0.1% to 7,409.88.