Indian bourses continue to trade in negative terrain

Indian bourses continued to trade in negative territory in early afternoon session, on account of selling in frontline blue chip counters. Investors maintained cautious approach ahead of Futures and Options (F&O) derivative expiry for April series due tomorrow. Moreover, weak global cues and rupee depreciation against the US dollar, too weighed on the sentiments. However, further fall got restricted as some support came with Ashish Kumar Bhutani’s, joint secretary in Ministry of Agriculture statement that agriculture credit is growing every year and reached Rs 10 lakh crore last fiscal, while stressing upon the need to increase the flow to small farmers as well as providing loan access to tenant cultivators. Bhutani said Rs 6.8 lakh crore was short-term crop loans out of Rs 10 lakh crore credit disbursed last fiscal. In the short-term crop loans, he said 50 per cent amount was provided to small and marginal farmers. In the scrip specific development, Future Enterprises was up by over two and half percent on raising Rs 500 crore by allotting non-convertible debentures (NCDs) on a private placement basis.

On the global front, Asian markets were trading in red, following the overnight sell-off on Wall Street. Warnings on profit outlook from bellwether US companies and worries about rising bond yields as well as their impact on inflation have dampened investor sentiment. Back home, the BSE Sensex is currently trading at 34552.13, down by 64.51 points or 0.19% after trading in a range of 34501.89 and 34614.61. There were 9 stocks advancing against 22 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index was down by 0.11%, while Small cap index was up by 0.12%.

The top gaining sectoral indices on the BSE were Telecom up by 1.60%, IT up by 1.56%, TECK up by 1.39% and Realty up by 1.04%, while Metal down by 1.06%, Oil & Gas down by 0.82%, Utilities down by 0.81%, Capital Goods down by 0.80% and Power down by 0.70% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 4.19%, TCS up by 1.69%, Wipro up by 1.65%, Mahindra & Mahindra up by 1.32% and Infosys up by 1.31%. On the flip side, ONGC down by 1.62%, Tata Steel down by 1.50%, NTPC down by 1.33%, Dr. Reddy’s Lab down by 1.25% and Larsen & Toubro was down by 1.21% were the top losers.

Meanwhile, the Finance Ministry has proposed to relax certain conditions for availing a concessional tax rate of 10% on long-term capital gains (LTCG) arising from transfer of listed equity shares or units of equity-oriented fund. After a gap of 14 years, the Union Budget 2018 reintroduced 10% tax on LTCG exceeding Rs 1 lakh from sale of shares. However, LTCG tax was nil for shares sold after a year of purchase till March 2018, as per Budget 2018 proposals. LTCG on sale of unlisted shares is taxed at 20 percent, while short-term capital gain tax on it is 30 percent.

The Finance Ministry has said that to provide the applicability of the tax regime under Section 112A of the I-T Act to genuine cases where the STT could not have been paid, it has also been provided in sub-section (4) of Section 112A of the Act that the Central Government may specify, by notification, the nature of acquisitions in respect of which the requirement of payment of STT shall not apply in the case of acquisition of equity share in a company.

In the draft notification, the Central Board of Direct Taxes (CBDT) has specified the nature of acquisitions in respect of which requirement of payment of STT would not apply for availing the concessional rate of LTCG. Finance Act 2018 provided for long term capital gain tax on transfer of specified securities only if STT has been paid on acquisition and transfer of such capital asset. It also authorised the Central government to notify genuine cases where such payment of STT could not be done.

The CNX Nifty is currently trading at 10586.10, down by 28.25 points or 0.27% after trading in a range of 10576.65 and 10612.60. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 3.94%, TCS up by 1.83%, Mahindra & Mahindra up by 1.50%, Tech Mahindra up by 1.36% and Infosys up by 1.32%. On the flip side, Cipla down by 2.23%, Vedanta down by 1.83%, ONGC down by 1.75%, Hindalco down by 1.71% and Tata Steel was down by 1.70% were the top losers.

All the Asian markets were trading in red; Hang Seng decreased 313.41 points or 1.02% to 30,322.83, Jakarta Composite dipped 80.28 points or 1.29% to 6,149.36, Nikkei 225 dropped 62.8 points or 0.28% to 22,215.32, Taiwan Weighted shed 19.53 points or 0.18% to 10,559.97, KOSPI Index was down by 15.33 points or 0.62% to 2,448.81, FTSE Bursa Malaysia KLCI fell 14.39 points or 0.77% to 1,850.95 and Shanghai Composite decreased 8.78 points or 0.28% to 3,120.14.