Bourses maintain upbeat mood in afternoon deals

Indian equity indices maintained their upbeat mood in early afternoon session, as buying momentum in the equities persisted. Domestic sentiments remained firm with the report that the government’s revenue collection during the first nine-and-a-half months of the current fiscal rose by 18.7 per cent to Rs. 6.89 lakh crore, higher than the net collections for the corresponding period of last year, mainly on account of a healthy growth in advance tax mop-up. Adding the optimism among investors, Commerce and Industries Minister Suresh Prabhu said that India is expected to become a $ 5 trillion economy in the next 8-9 years with the manufacturing sector contributing 20 per cent to that. Besides, positive global cues together with heavy buying appeared in Banking, FMCG, and Auto stocks, too added some thrust on the street. Meanwhile, the Goods and Services Tax (GST) Council, which will meet today, is likely to take up rationalisation of rates of about 70 items, of which at least 40 are services. Amendment in rules may also be taken up to simplify filing and plug some of the loopholes. In scrip specific development, Jubilant Life Sciences was up by over two and half percent after issuing Commercial Papers (CPs) of Rs 90 crore on January 17, 2018.

On the global front, Asian markets were trading mostly in green, as investors tracked another milestone on Wall Street. Investors also awaited the release of annual Chinese economic data later in the day, which will provide a fresh look at the world's number two economy and key driver of global growth.  Back home, the BSE Sensex is currently trading at 35458.63, up by 376.81 points or 1.07% after trading in a range of 35338.75 and 35489.53. There were 22 stocks advancing against 9 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.31%, while Small cap index was up by 0.02%.

The top gaining sectoral indices on the BSE were Bankex up by 1.70%, FMCG up by 1.14%, Auto up by 0.79%, Capital Goods up by 0.72% and Industrials up by 0.29%, while Metal down by 1.77%, Realty down by 1.51%, Oil & Gas down by 0.86%, Telecom down by 0.81% and Utilities down by 0.75% were the top losing indices on BSE.

The top gainers on the Sensex were HDFC Bank up by 2.73%, Yes Bank up by 2.69%, ITC up by 2.46%, Indusind Bank up by 2.32% and Mahindra & Mahindra up by 2.27%. On the flip side, Tata Steel down by 2.10%, Coal India down by 0.84%, Infosys down by 0.82%, Hindustan Unilever down by 0.65% and Sun Pharma down by 0.58% were the top losers.

Meanwhile, Confederation of Indian Industry (CII) has urged the government for inclusion of all petroleum products under the ambit of Goods and Services Tax (GST) at the earliest. It noted that as of now, petroleum products like crude oil, petrol, diesel, jet fuel or aviation turbine fuel (ATF) and natural gas are not included in GST, which kicked in from July 1, 2017. It also said that until this is done, C Forms should be continued to avoid high tax incidence on these products.

In accordance with the Industry body, though the understanding is that the previous VAT and CST rules would continue to apply to the excluded products, however, the related sectors continue to incur huge GST impact on all inputs without any set-off, as sale of crude oil and natural gas are outside the purview of GST and are subject to existing OIDA (Oil Industry Development Act) Cess, Central Sales Tax Act and State Value Added Tax. Besides, it noted that after GST rollout, credit on VAT paid on petroleum products including natural gas is not available and the amendment of the CST Act has significantly altered inter-state sale of the products. Therefore, it pointed out that post GST, there has been an increased tax cost on the products, which was not the intent of the government. It added that the central government vide Taxation Laws Amendment Act 2017, amended the definition of 'Goods' under the CST Act to include only crude petroleum, diesel, petrol, ATF, natural gas and alcoholic liquor for human consumption.

CII further stated that consequently, certain State Commercial Tax Departments have taken a narrow interpretation that the concessional rate of 2 percent against C Forms can be availed only if the specified goods are used for resale, or manufacture of the same goods and not for manufacture of any other goods, or in telecommunication, or mining, or generation of power. As a result, it noted that fertiliser companies are not eligible for C Form as the gas is used to manufacture urea and not for manufacture of natural gas. Likewise, it pointed out that automobile manufacturers are not eligible for C Form for inter-state purchase of diesel, petrol or natural gas, which they have to mandatorily fill in the tanks of new vehicles. It added that if purchasing dealer is not engaged in inter-state supply of goods (as defined under the CST Act), then he will not be liable for registration and thus not eligible for the issuance of Form-C which imposes an additional tax cost burden.

The CNX Nifty is currently trading at 10869.40, up by 80.85 points or 0.75% after trading in a range of 10844.95 and 10887.50. There were 25 stocks advancing against 25 stocks declining on the index.

The top gainers on Nifty were UPL up by 3.48%, Yes Bank up by 2.82%, HDFC Bank up by 2.78%, ITC up by 2.57% and Mahindra & Mahindra up by 2.41%. On the flip side, Bharti Infratel down by 4.37%, GAIL India down by 2.60%, Hindalco down by 2.32%, Vedanta down by 2.11% and Tata Steel down by 2.09% were the top losers.

Asian markets were trading mostly in green; KOSPI Index increased 0.38 points or 0.02% to 2,515.81, Hang Seng was up by 7.69 points or 0.02% to 31,991.10, Shanghai Composite added 22.38 points or 0.65% to 3,467.06, Jakarta Composite rose 24.65 points or 0.38% to 6,469.16 and Taiwan Weighted increased 66.77 points or 0.61% to 11,071.57.

On the flip side, Nikkei 225 decreased 104.97 points or 0.44% to 23,763.37 and FTSE Bursa Malaysia KLCI was down by 4.68 points or 0.26% to 1,823.95.