Domestic benchmarks trim some initial gains

Domestic benchmarks trimmed some of their initial gains in late morning session but managed to trade in green territory, as investors were watchful of RBI’s two-day policy meet that starts today. It is widely expected that the central bank will maintain status-quo on key interest rates. Traders took some support with Finance Minister Arun Jaitley’s statement that direct tax collections hit the landmark figure of Rs 10.02 lakh crore in 2017-18, 18 per cent higher than previous fiscal, the number of income tax returns filed rose to 6.84 crore during 2017-18, compared to 5.43 crore filed in 2016-17. This represents a 26 per cent rise in ITRs. However, markets pared some of their initial gains as investors took note of the report which stated that collections under the goods and services tax (GST) were marginally lower at Rs 7.18 trillion against the target of Rs 7.28 trillion for the eight months. The target was arrived from the monthly run rate of Rs 910 billion. The run rate was, in turn, derived from the Budget Estimates and 14% indirect tax revenue growth for states for 2017-18. Meanwhile, on a net basis, domestic institutional investors (DIIs) bought shares worth Rs 479.18 crore, while foreign portfolio investors (FPIs) sold shares worth Rs 376.51 crore.

On the global front, Asian markets were mostly trading in red, as simmering fears of a Sino-U.S. trade war overshadowed a bounce on Wall Street and left investors reluctant to take positions in anything. Back on domestic turf, shares of fertiliser and agrochemicals companies were trading higher by up to 10%, with the report from forecasting agency Skymet stating that this year monsoon could be ‘normal’ and expected to be 100% of the long period average. In the script development, Tata Motors edged higher as the Tata group automaker-owned Jaguar Land Rover reported a humongous increase of 83% in total sales in the last financial year ended March, 31 2018, while Capacite Infra projects gained on bagging contracts worth Rs 365.50 crore from Oberoi Realty Group entities.

The BSE Sensex is currently trading at 33430.84, up by 60.21 points or 0.18% after trading in a range of 33353.09 and 33505.53. There were 18 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index surged 0.52%, while Small cap index was up by 0.64%.

The top gaining sectoral indices on the BSE were Auto up by 1.70%, Realty up by 1.39%, Industrials up by 0.85%, Consumer Disc up by 0.70% and Metal was up by 0.66%, while Consumer Durables down by 0.87%, Oil & Gas down by 0.50%, IT down by 0.27%, TECK down by 0.27% and Capital Goods was down by 0.20% were the top losing indices on BSE.

The top gainers on the Sensex were Tata Motors up by 5.05%, Tata Motors - DVR up by 4.73%, Mahindra & Mahindra up by 1.43%, Yes Bank up by 1.33% and Hero MotoCorp was up by 1.17%. On the flip side, NTPC down by 1.24%, Dr. Reddys down by 1.08%, Axis Bank down by 0.89%, HDFC down by 0.80% and Larsen & Toubro was down by 0.57% were the top losers.

Meanwhile, Public sector banks (PSBs) have written-off non-performing assets (NPAs) or bad loans worth Rs 2.41 lakh crore in over three years. Minister of State of Finance Shiv Pratap Shukla has stated that writing-off bad loans is a regular exercise carried out by banks to clean up their balance sheets and achieving taxation efficiency. As per the Reserve Bank of India (RBI) data on global operations, PSBs wrote off Rs 2,41,911 crore from financial year 2014-15 till September 2017.

Shukla pointed out that loans are written off for tax benefit and capital optimisation, while borrowers of such loans continue to be liable for repayment. He also noted that recovery of dues takes place on ongoing basis under legal mechanism, including SARFAESI Act and debt recovery tribunals. Therefore, he said that write-offs does not benefit borrowers.

Besides, according to the latest RBI data, 21 state-run banks which account for more than two-thirds of the country's banking assets had as of December 31 stressed loans of Rs 8.26 lakh crore, or 15.8 percent of their total loans.

The CNX Nifty is currently trading at 10256.00, up by 11.00 points or 0.11% after trading in a range of 10239.55 and 10279.85. There were 23 stocks advancing against 27 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 5.07%, Eicher Motors up by 3.54%, Vedanta up by 1.68%, Mahindra & Mahindra up by 1.40% and Yes Bank was up by 1.17%. On the flip side, HPCL down by 1.89%, BPCL down by 1.78%, Titan Co down by 1.66%, UPL down by 1.34% and GAIL India was down by 1.29% were the top losers.

Asian markets were trading mostly in red; Hang Seng declined 138.01 points or 0.46% to 30,042.09, Taiwan Weighted slipped 66.74 points or 0.61% to 10,821.53, KOSPI Index fell by 33.69 points or 1.38% to 2,408.74, FTSE Bursa Malaysia KLCI was down by 3.3 points or 0.18% to 1,847.48.

On the other flip, Jakarta Composite gained 1.86 points or 0.03% to 6,230.87, Shanghai Composite surged 14.45 points or 0.46% to 3,151.08, Nikkei 225 was up by 37.97 points or 0.18% to 21,330.26.