Local bourses hold gains in afternoon session

The local barometer gauges held their gains of over half a percent each in early afternoon session, on account of buying in frontline counters. Sentiments on the street remained in optimistic mood with Finance Minister Arun Jaitley confidence that there will be no more fiscal slippages as the financial position is likely to be comfortable from the next fiscal. Markets also drew some solace with report that India’s external debt has remained within manageable limits as indicated by the external debt indicators, and the country is not among the world’s top debtors. India’s external debt stock stood at $495.7 billion at quarter ending September 2017. Further, positive trade in other Asian markets along with sustained buying in Realty, Healthcare, Industrials and Capital Goods stocks too supported the markets to sustain the early leads. However, there was some cautiousness ahead of macro data (December IIP and January CPI inflation) due later today. Meanwhile, the rupee recovered 15 paise to 64.24 against the US dollar in early trade on heightened selling of the US currency by exporters and banks. In scrip specific development, Reliance Infrastructure was up by around two percent after receiving LoA worth Rs 567 crore from NTPC for Flue Gas Desulphurisation (FGD) works of its 3x500 MW power plant in Jhajjar, Haryana.

On the global front, Asian markets were trading in green, as investors cautiously edged back into buying after last week's global rout, with confidence lifted by a rally on Wall Street. Back home, the BSE Sensex is currently trading at 34242.59, up by 236.83 points or 0.70% after trading in a range of 34115.12 and 34278.24. There were 26 stocks advancing against 5 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 1.44%, while Small cap index was up by 1.74%.

The top gaining sectoral indices on the BSE were Realty up by 1.93%, Healthcare up by 1.60%, Industrials up by 1.59%, Capital Goods up by 1.53% and Basic Materials up by 1.45%, while IT down by 0.23% and TECK down by 0.16% were the only losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 4.43%, ONGC up by 2.18%, Yes Bank up by 2.01%, Sun Pharma up by 1.83% and Hero MotoCorp up by 1.60%. On the flip side, SBI down by 1.92%, Infosys down by 0.61%, ICICI Bank down by 0.11%, Coal India down by 0.03% and TCS down by 0.03% were the top losers.

Meanwhile, since the Indian benchmark indices have fallen by over 1% and closed at a one-month low level, the capital markets regulator, Securities and Exchange Board of India (SEBI) chief Ajay Tyagi has said that the volatility in the Indian equity markets may continue for some time. He explained that the global factors are mainly responsible for the volatility in the Indian markets, and outweighs the concerns related to long-term capital gains tax (LTCG). He also said that there are no issues of concern for investors in terms of safety and security of the Indian marketplace.

On the matter of re-introduction of LTCG tax as proposed in the Budget, Tyagi said that SEBI has not received any representation from investors so far against this. He admitted that the tax would impact the market and also said that it will be wrong to say LTCG will have no impact at all on Indian markets, but any such impact would be small and global factors pose bigger risks. About the timing of imposing the LTCG, he said it was an opportune time as markets were booming.

SEBI chief further said that small investors need not panic since they are doing well to invest via Mutual Funds. But, he pointed out that they cannot be as risk-free as bank deposits. He added that the market regulator is also set to come out with norms on corporate bonds to encourage firms to tap this route for fund raising. Besides, Finance Minister Arun Jaitley, on February 1, proposed to tax LTCG on equities exceeding Rs 1 lakh at 10%, which is expected to bring in a revenue of Rs Rs 20,000 crore.

The CNX Nifty is currently trading at 10521.55, up by 66.60 points or 0.64% after trading in a range of 10485.40 and 10538.10. There were 41 stocks advancing against 9 stocks declining on the index.

The top gainers on Nifty were Tata Steel up by 4.15%, ONGC up by 2.56%, Aurobindo Pharma up by 2.43%, Sun Pharma up by 2.08% and Lupin up by 2.04%. On the flip side, HCL Tech. down by 2.17%, BPCL down by 2.12%, SBI down by 1.84%, HPCL down by 1.40% and Bharti Infratel down by 1.02% were the top losers.

All the Asian markets were trading in green; FTSE Bursa Malaysia KLCI rose 11.45 points or 0.63% to 1,831.27, Jakarta Composite added 17.65 points or 0.27% to 6,523.18, KOSPI Index surged 21.61 points or 0.91% to 2,385.38, Shanghai Composite increased 30.72 points or 0.98% to 3,160.57, Taiwan Weighted gained 49.34 points or 0.48% to 10,421.09 and Hang Seng was up by 191.16 points or 0.65% to 29,698.58.