Local equities continue to trade in green

Local equity benchmarks continued their trade in positive territory in morning session, with Sensex and Nifty gaining over 160 and 45 points, respectively, taking positive cues from Asian markets. Traders took encouragement from a report that overall exports from India to BRICS saw an upswing of 7.50% in the first quarter of 2018 over the corresponding period of last year in terms of total volumes, while the country's imports from BRICS nations is reduced by 3.50%. Investors overlooked the Securities and Exchange Board of India’s (SEBI) data that investments through participatory notes into Indian capital markets plunged to over nine-year low of Rs 83,688 crore at June-end amid stringent norms put in place by the SEBI to check the misuse of these instruments. 

On the global front, Asian markets were trading in green, with China outperforming regional markets, as investors kept an eye on bond yields and the falling Chinese yuan. Those gains came after China's State Council on June 23 said it would engage in more ‘vigorous’ fiscal policy as the economy cools. Back home, on the sectoral front, infrastructure stocks jumped over 1% on CRISIL report that Highways construction companies are set to clock a 20% compound annual growth rate in revenue till 2020. The buoyancy in growth will be driven by the government focus and spending on road construction. In scrip specific development, Karnataka Bank jumped over 1.50% on inaugurating 809th branch in Karnataka.

The BSE Sensex is currently trading at 36885.38, up by 166.78 points or 0.45% after trading in a range of 36790.42 and 36902.06. There were 22 stocks advancing against 8 stocks declining, while 1 stock remained unchanged on the index.

The broader indices were trading in green; the BSE Mid cap index gained 1.29%, while Small cap index was up by 1.54%.

The top gaining sectoral indices on the BSE were Basic Materials up by 3.40%, Telecom up by 2.13%, Metal up by 2.04%, Industrials up by 1.34% and Capital Goods was up by 1.11%, while there were no losers on BSE sectoral front.

The top gainers on the Sensex were Vedanta up by 2.65%, Adani Ports & SEZ up by 2.00%, Maruti Suzuki up by 1.98%, Bharti Airtel up by 1.85% and Tata Motors was up by 1.84%. On the flip side, Bajaj Auto down by 1.22%, Hero MotoCorp down by 1.08%, Wipro down by 0.85%, Yes Bank down by 0.44% and TCS was down by 0.23% were the top losers.

Meanwhile, Union Finance Minister Piyush Goyal has said that rising tax collections will further help reduce the tariffs, couple of days after goods and services tax (GST) rates were cut on 100 items. Besides, he underlined the Directorate General of Anti-Profiteering has been directed to keep a tab on manufacturers of sanitary napkins, so that benefits of the GST rate cut are passed on to consumers. The GST Council had exempted sanitary napkins from GST.

There have been reports that sanitary napkins will not benefit from the exemption from GST since they will not be able to claim credit on raw materials used in manufacturing. Terming these reports as ‘misplaced calculation’, the Minister said ‘I have already instructed the department, which looks after anti-profiteering, to investigate and ensure that either the rates should have had come down on July 1, 2017, or should come down now. It cannot be that they have the cake and eat it too’. Moreover, for the current financial year (FY19) the government’s target of Rs 1 trillion a month, is still not a norm.

The Council had cut rates on almost 100 items. Of these, 18-20 items saw the rate coming down from the highest slab of 28%, leaving just 35 items, including ACs, digital cameras, video recorders, dishwashing machines and automobiles, in the highest tax bracket. GST collections have been on the rise since the end of financial year 2018. It touched slightly over Rs 1 trillion in April, but that was an aberration. After that, collections came down to Rs 94016 crore in May and Rs 95610 crore in June, which were still higher than the average monthly collections of Rs 89885 crore in FY18.

The CNX Nifty is currently trading at 11132.20, up by 47.45 points or 0.43% after trading in a range of 11103.50 and 11141.45. There were 35 stocks advancing against 15 stocks declining on the index.

The top gainers on Nifty were Grasim Industries up by 5.44%, Ultratech Cement up by 5.00%, Hindalco up by 3.85%, Indiabulls Housing Finance up by 2.88% and Vedanta was up by 2.55%. On the flip side, Bajaj Finance down by 1.98%, Bajaj Finserv down by 1.26%, Cipla down by 1.03%, Wipro down by 1.03% and Reliance Industries was down by 0.74% were the top losers.

All Asian market were trading in green; KOSPI strengthened 14.28 points or 0.63% to 2,283.59, Nikkei 225 gained 118.98 points or 0.53% to 22,515.97, Taiwan Weighted rose 8.74 points or 0.08% to 10,955.63, Shanghai Composite soared 46.20 points or 1.59% to 2,905.74, Straits Times advanced 8.63 points or 0.26% to 3,302.34, Hang Seng surged 439.51 points or 1.53% to 28,695.63 and Jakarta Composite was up by 17.79 points or 0.3% to 5,933.59.