Indian stock markets extend gains in early noon session

Indian stock markets extended their gains in early noon session as GST rate cut on July 21 seemed to boost sentiments following fresh fund inflows from foreign investors. Some support also came in with industry chamber CII stating that decision of the GST Council to cut rates and simplification of return filing process will increase the compliance rate and add to revenue buoyancy. Investors continued to take support from a report stating that ASEAN-India trade is likely to touch $100 billion by 2020 calling for greater cooperation between the two sides in economic sector. Sentiments remained up-beat on report that Foreign Institutional Investors (FIIs) bought shares worth Rs 310.27 crore on July 20, 2018, as per provisional data from the stock exchanges.  Besides, buying in FMCG, Telecom and Consumer Durables helped lift the markets higher. Amongst the individual stocks on the BSE, ITC and Hindustan Unilever were gaining more than 2 percent. Meanwhile, the market breadth favoring positive trend and broader indices were also trading in green.

On the global front, Asian markets were trading mixed as the dollar’s pullback and some renewed trade worries hung over the market. Back home, in scrip specific development, Subros gained on enhancing localisation efforts to support long term EBIDTA level and Sterlite Technologies surged on completing acquisition of Metallurgica Bresciana.

The BSE Sensex is currently trading at 36570.67, up by 74.30 points or 0.20% after trading in a range of 36491.83 and 36630.82. There were 17 stocks advancing against 13 stocks declining on the index, while 1 stock remained unchanged.

The broader indices were trading in green; the BSE Mid cap index rose 0.28%, while Small cap index up by 0.23%.

The top gaining sectoral indices on the BSE were FMCG up by 2.23%, Telecom up by 1.06%, Consumer Durables up by 0.88%, Utilities up by 0.74% and Power up by 0.60%, while Auto down by 0.87%, Metal down by 0.49%, Energy down by 0.45%, IT down by 0.28% and TECK down by 0.12% were the losing indices on BSE.

The top gainers on the Sensex were ITC up by 3.89%, Hindustan Unilever up by 2.42%, Bharti Airtel up by 2.10%, Asian Paints up by 2.07% and NTPC up by 1.96%. On the flip side, Hero MotoCorp down by 4.48%, Bajaj Auto down by 4.00%, Wipro down by 2.99%, Reliance Industries down by 1.06% and HDFC Bank down by 0.97% were the top losers.

Meanwhile, giving major relief to the common man, the Goods and Services Tax (GST) at its 28th meeting, has reduced tax rates on several products including refrigerators, washing machines and small televisions, which would now be taxed at 18 percent, down from the current 28 percent. Apart from this, it also decided to exempt GST on sanitary napkins, rakhis, fortified milk and idols of deities made of stone, marble and wood. The new tax rates will be enforced from July 27.

The highest tax bracket of 28 percent has been rationalised further with rates on daily-use items like perfumes, cosmetics, toiletries, hair dryers, shavers, mixer grinder, vacuum cleaners, lithium ion batteries, being lowered to 18 percent. Refrigerators, small televisions, of up to 25 inches, lithium ion batteries, vacuum cleaners, domestic electrical appliances, such as food grinders, mixers....storage water heaters, immersion heaters, hair dryers, hand driers, electric smoothing irons, among others have been brought to the 18 percent slab.

Footwear costing up to Rs 1,000 will now attract 5 percent GST. So far, footwear up to Rs 500 attracted 5 percent GST, and those having retail sale price of over Rs 500 attracted 18 percent rate. Tax rate on ethanol has been slashed to 5 percent from 18 percent at present. Besides, tax rates on worked up Kota stone, sand stone and similar quality of local stones were cut from 18 to 12 percent, with the purpose of avoiding classification disputes. Beside, tax rate on handicraft items such as handbags, pouches and purses, jewellery box, wooden frames of paintings and photographs among others have been brought under the 12 percent slab, from 18 percent.

GST on handmade carpets and handmade textile floor coverings has been reduced from 12 percent to 5 percent. The tax rate on supply of e-books has been cut to 5 percent from 18 percent. The hotel industry too has been given major relief as tax rate would be based on the room tariff paid and not the published tariff. Earlier, there was a lack of clarity on the issue causing a lot of trouble for consumers booking hotels with 'declared tariffs' of Rs 7,500 and above which incurred 28 percent GST. While hotels with tariff below Rs 1,000 are exempted from GST, those with tariff between Rs 1,000-2,500 are taxed at 12 percent, those between Rs 2,500-7,500 at 18 percent, and above Rs 7,500 at 28 percent.

The CNX Nifty is currently trading at 11036.85, up by 26.65 points or 0.24% after trading in a range of 11010.95 and 11055.45. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were UPL up by 8.27%, ITC up by 3.91%, Hindustan Unilever up by 2.61%, Bajaj Finserv up by 2.42% and Bharti Airtel up by 2.20%. On the flip side, Hero MotoCorp down by 4.51%, Bajaj Auto down by 4.07%, Wipro down by 3.14%, Tech Mahindra down by 2.12% and Indiabulls Housing down by 1.50% were the top losers.

Asian Markets were trading mixed; Taiwan Weighted increased 14.78 points or 0.14% to 10,946.89, Hang Seng surged 51.32 points or 0.18% to 28,275.80, Shanghai Composite advanced 20.25 points or 0.71% to 2,849.52 and Jakarta Composite was up 41.43 points or 0.7% to 5,914.21.

On the flip side, KOSPI decreased 24.11 points or 1.06% to 2,265.08, Straits Times declined 4.60 points or 0.14% to 3,293.23 and Nikkei 225 was down 300.89 points or 1.34% to 22,396.99.