Benchmarks trade in fine fettle in early deals

Indian equity benchmarks are trading in fine fettle in early deals on Thursday with frontline gauges recapturing their crucial 38,100 (Sensex) and 11,500 (Nifty) levels. Sentiments remained upbeat with Finance Minister Arun Jaitley’s statement that there is no need to worry over the steep fall in the Indian rupee’s value against the US dollar as the inherent strength of the country’s economy will aid in arresting the downtrend. Some support also came with the Finance Ministry’s statement that Goods and Services Tax (GST) refunds can be claimed by simply submitting a printout of GSTR-2A form to tax authorities instead of giving all purchase invoices of a month. Traders took note of The Securities and Exchange Board of India’s (SEBI) statement that it would review an order tightening rules on foreign funds ownership by entities of Indian origin, after some fund managers said it could lead to massive dollar outflows.

On the global front, Asian markets exhibiting mixed trend at this point of time amid ongoing concerns about emerging-markets. The US markets ended mostly lower on Wednesday as trade tensions resurfaced ahead of more talks between the United States and Canada on revamping the North American Free Trade Agreement.

Back home, steel sector stocks edged higher with ICRA’s report that sharp depreciation in the rupee is likely to help the domestic steel industry lower imports and boost exports in the coming months, which in turn may improve the country's overall steel trade balance. Sugar sector stocks remained in sweet spot, as facing an unprecedented crisis of surplus production, the Indian sugar industry demanded the government hike the minimum sale price (MSP) of sugar to Rs 36 a kilo (kg), from the current Rs 29 and mandatorily fix a quota of export of 7 million tonnes (MT) for the 2018-19 season that starts from October.

The BSE Sensex is currently trading at 38112.23, up by 93.92 points or 0.25% after trading in a range of 37983.15 and 38182.77. There were 21 stocks advancing against 10 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.62%, while Small cap index was up by 0.49%.

The top gaining sectoral indices on the BSE were Realty up by 1.41%, Healthcare up by 1.17%, Utilities up by 1.08%, Power up by 0.83% and Basic Materials was up by 0.76%, while Telecom down by 0.59%, TECK down by 0.39%, Consumer Discretionary Goods & Services down by 0.03% were the few losing indices on BSE.

The top gainers on the Sensex were Power Grid Corporation up by 2.57%, Tata Steel up by 1.46%, Coal India up by 1.39%, Kotak Mahindra Bank up by 1.17% and Reliance Industries up by 0.91%. On the flip side, Bharti Airtel down by 0.70%, HDFC Bank down by 0.38%, TCS down by 0.34%, Axis Bank down by 0.30% and ONGC down by 0.23% were the top losers.

Meanwhile, amid continues depreciation of Indian currency against US dollar, Finance Minister Arun Jaitley has said the reasons for fall in rupee are global factors. He highlighted that the domestic unit was better off as compared to other currencies. He said ‘I don’t think there is any need for the world’s fastest-growing economy to come out with panic and knee-jerk reactions.’ The rupee’s unabated fall continued for the sixth straight session on September 5, 2018 as it hit yet another closing low of 71.75 against the US dollar, tumbling 17 paise. The battered rupee has lost 165 paise in the last six trading sessions.

Jaitley said ‘If you look at the domestic economic situation and the global situation, there are virtually no domestic reasons which are attributable to this. The reasons are global.’ He further said the dollar has strengthened against almost every other currency and added that the rupee has consistently either strengthened or remained in a range.

The Finance Minister also said ‘It has not weakened...the rupee is better-off’. He added that the rupee has strengthened against other currencies like the British Pound and the Euro. He assured that the Reserve Bank of India (RBI) is working in the right direction and taking necessary action. On the inflation front, he said the government has consistently maintained 4% inflation during the last four years.

The CNX Nifty is currently trading at 11503.20, up by 26.25 points or 0.23% after trading in a range of 11459.50 and 11519.95. There were 33 stocks advancing against 17 stocks declining on the index.

The top gainers on Nifty were GAIL India up by 2.04%, Tata Steel up by 1.95%, Power Grid Corporation up by 1.92%, Ultratech Cement up by 1.70% and Kotak Mahindra Bank up by 1.52%. On the flip side, Zee Entertainment down by 8.21%, Tech Mahindra down by 0.71%, Bharti Airtel down by 0.69%, Bharti Infratel down by 0.64% and Hindalco down by 0.60% were the top losers.

Asian markets are trading mixed; Nikkei 225 decreased 49.80 points or 0.22% to 22,531.03, Taiwan Weighted declined 59.52 points or 0.54% to 10,935.61, Jakarta Composite slipped 0.70 points or 0.01% to 5,682.80 and Hang Seng was down by 175.35 points or 0.65% to 27,068.50.

On the flip side, Straits Times increased 1.15 points or 0.04% to 3,157.43, KOSPI added 1.39 points or 0.06% to 2,293.16 and Shanghai Composite was up by 4.51 points or 0.17% to 2,708.85.