Key gauges continue firm trade in morning session

Indian equity benchmarks continued to show a positive trend in morning session, with gains of around half a percent each, due to robust buying in IT, TECK and Utilities stocks and unabated purchases by domestic institutional investors. Traders remained optimistic with CARE Ratings expecting that India’s GDP to grow by 7.5% in 2018-19. This growth will be contingent upon favourable monsoon, pick up in investment and increased private sector spending supported by continued government spending. Sentiments also remained upbeat as domestic institutional investors (DIIs) continued to be net buyers of Indian shares. As per provisional NDSL data, on May 24, 2018, they bought shares worth a net Rs 1,480.51 crore, while foreign portfolio investors (FPIs) sold shares worth Rs 701.93 crore.

On the global front, Asian market were trading mixed, amid fragile market sentiment after US President Donald Trump called off a key summit with North Korea, though investor concerns were softened by expectations the two countries may still continue dialogue.

Back home, banking sector stocks were trading in positive terrain as traders took encouragement from the Reserve Bank of India’s report stating that banks’ credit grew by 12.64% year-on-year to Rs 85,51,099 crore in the fortnight ended May 11, 2018. Agriculture stocks remained in focus on a report that India and the Netherlands are keen to further cooperate in the field of agriculture India and the Netherlands are keen to further cooperate in the field of agriculture and allied sectors. In scrip specific development, JMC Projects gained on getting nod to raise funds up to Rs 150 crore.

The BSE Sensex is currently trading at 34834.64, up by 171.53 points or 0.49% after trading in a range of 34700.52 and 34853.14. There were 25 stocks advancing against 6 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.83%, while Small cap index was up by 0.68%.

The top gaining sectoral indices on the BSE were IT up by 1.44%, TECK up by 1.34%, Utilities up by 1.07%, Auto up by 0.96% and Metal was up by 0.90%, while there were no losers on BSE sectoral front.

The top gainers on the Sensex were Tata Steel up by 2.62%, Infosys up by 1.92%, Tata Motors up by 1.68%, TCS up by 1.48% and NTPC was up by 1.27%. On the flip side, SBI down by 1.30%, ITC down by 1.24%, Coal India down by 0.84%, Asian Paints down by 0.51% and Larsen & Toubro was down by 0.27% were the top losers.

Meanwhile, NITI Aayog vice chairman Rajiv Kumar has said that states have the capacity and must cut the duty on petrol. As regards the centre, he said that they have the fiscal space and should create more to deal with the problem of rising oil prices. He noted that there is merit in reducing the duties, but both by the states and the centre. He said “More so for the states as they tax the oil on ad valorem basis ... So states can take that cut much more and better than the Union government.”

Kumar further stated that it is important for states to agree 10-15 percent duty cut and take home the same amount of tax revenue as budgeted. He also said that not doing that means being exceptionally greedy at the cost of not just the people but also the economy. He noted that the states on an average tax petrol at 27 percent. Besides, he said that the centre could consider reducing the additional excise duty on petrol. He added that it should not temper with infrastructure cess which is being directly used for developmental activities. He also opined that not only petrol but electricity should also be brought under the Goods and Services Tax (GST) regime.

With the rise of the crude prices in the international market, the state-owned oil companies increased the domestic prices for the 11th day in a row. Petrol prices in Delhi were increased by 26 paise to Rs 77.47 per litre and diesel by 15 paise to Rs 68.53 per litre. The government had raised excise duty nine times between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by Rs 2 a litre. At present, the centre levies Rs 19.48 a litre excise duty on petrol and Rs 15.33 on diesel.

The CNX Nifty is currently trading at 10571.40, up by 57.55 points or 0.55% after trading in a range of 10524.00 and 10573.25. There were 36 stocks advancing against 14 stocks declining on the index.

The top gainers on Nifty were Bajaj Finserv up by 3.21%, Hindalco up by 3.08%, Tata Steel up by 2.72%, Bajaj Finance up by 2.37% and Infosys was up by 2.10%. On the flip side, Vedanta down by 2.04%, Bharti Infratel down by 1.57%, SBI down by 1.23%, ITC down by 1.22% and HPCL was down by 1.17% were the top losers.

Asian market were trading mixed, Taiwan Weighted surged 17.09 points or 0.16% to 10,954.02, FTSE Bursa Malaysia KLCI gained 19.54 points or 1.1% to 1,795.20 and Jakarta Composite was up by 35.02 points or 0.59% to 5,981.55.

On the other side, Hang Seng slipped 79.29 points or 0.26% to 30,681.12, KOSPI Index losses 6.15 points or 0.25% to 2,459.86, Nikkei 225 declined 5.84 points or 0.03% to 22,431.17 and Shanghai Composite was down by 2.31 points or 0.07% to 3,152.35.