Lackluster trade continues on Dalal Street

Indian equity benchmarks continued their lackluster trade in afternoon session, amid negative signals from other Asian markets.  Investors’ sentiment remain dented with global credit ratings agency Moody’s statement that liquidity constraints faced by some non-bank financial institutions (NBFIs) will likely tighten overall credit supply and slow India’s economic growth rate to just above 7% for the fiscal 2019 and 2020. In addition, any further distress in the Indian NBFI sector will pose significant downside risks to India's growth outlook. Caution also crept ahead of outcome of RBI board meeting, first for the new governor Shaktikanta Das. However, traders took some support with data showing that WPI inflation, which is calculated on wholesale prices, fell to 4.64 percent in November 2018, from 5.28 percent in October on lower power and fuel inflation and food deflation. On the global front, Asian markets were trading in red, as China reported a slew of economic data that missed expectations, deepening worries about headwinds facing the world's second largest economy.

The BSE Sensex is currently trading at 35939.09, up by 9.45 points or 0.03% after trading in a range of 35813.85 and 36019.02. There were 16 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.39%, while Small cap index was up by 0.11%.

The top gaining sectoral indices on the BSE were Telecom up by 3.82%, Oil & Gas up by 1.03%, Realty up by 0.93%, TECK up by 0.69% and PSU up by 0.62%, while Healthcare down by 0.39%, Capital Goods down by 0.27%, Consumer Durables down by 0.10% and Industrials down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Bharti Airtel up by 6.31%, Asian Paints up by 1.81%, Yes Bank up by 1.52%, Infosys up by 1.23% and ICICI Bank up by 1.15%. On the flip side, HDFC down by 1.62%, Maruti Suzuki down by 0.94%, Bajaj Auto down by 0.81%, Power Grid down by 0.79% and Coal India down by 0.74% were the top losers.

Meanwhile, the Goods and Services Tax (GST) Council, chaired by Union finance minister Arun Jaitley and comprising his state counterparts, may look at further rationalisation of the 28 percent slab by cutting tax rates on construction items, like cement in its upcoming meeting on December 22. The all-powerful GST Council has pruned the highest 28 percent slab by cutting tax rates on 191 goods over the last one-and-a-half year, leaving just 35 items in the highest tax bracket.

Previously, there were around 226 goods in the 28 percent category when GST was implemented on July 1, 2017. In its July meeting, the GST Council had further rationalised the 28 percent slab by cutting rates on paints and varnishes, and on daily-use items like perfumes, cosmetics, toiletries, hair dryers, shavers, mixer grinder, vacuum cleaners, lithium ion batteries, and cut rates to 18 percent. The 35 goods, which are left in highest slab include cement, automobile parts, tyres, automobile equipments, motor vehicles, yachts, aircrafts, aerated drinks, betting and demerit items like tobacco, cigarette and pan masala.

Cutting GST rate on cements would give a boost to the housing and construction industry as well as have positive impact on employment generation. Meanwhile, the government has collected Rs 7.76 lakh crore revenue from GST in the first eight months (April-November) of the current fiscal. The 2018-19 Union budget had estimated annual GST collection at Rs 13.48 lakh crore, which means a monthly target of Rs 1.12 lakh crore.

The CNX Nifty is currently trading at 10794.10, up by 2.55 points or 0.02% after trading in a range of 10752.10 and 10815.75. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Bharti Airtel up by 6.10%, Indian Oil Corp. up by 3.28%, Grasim Industries up by 2.24%, Asian Paints up by 1.84% and BPCL up by 1.79%. On the flip side, HCL Tech. down by 2.20%, HDFC down by 1.62%, Maruti Suzuki down by 1.05%, Bajaj Auto down by 0.92% and Axis Bank down by 0.86% were the top losers.

All Asian markets were trading in red; Nikkei 225 slipped 441.36 points or 2.02% to 21,374.83, Jakarta Composite dropped 3.78 points or 0.06% to 6,173.94, Straits Times trembled 41.27 points or 1.33% to 3,069.81, KOSPI fell 26.53 points or 1.27% to 2,069.02, Shanghai Composite declined 28.82 points or 1.09% to 2,605.23, Hang Seng decreased 411.84 points or 1.55% to 26,112.51 and Taiwan Weighted was down by 84.60 points or 0.86% to 9,774.16.