Benchmarks trade jubilantly in early deals

Indian equity benchmarks made a gap-up opening and are trading jubilantly in early deals with frontline gauges surpassing their crucial 38,300 (Sensex) and 11,500 (Nifty) levels, as traders getting encouragement with the trade ministry’s statement that India's trade deficit narrowed to $9.60 billion in February, dragged down by a fall in gold and oil imports, as compared to $14.73 billion in January. The data showed that in February, merchandise exports rose 2.44 percent from a year earlier to $26.67 billion, while imports were down 5.41 percent to $36.26 billion. Besides, gold imports in February fell 10.81 percent year-on-year to $2.58 billion, compared to $2.90 billion during the same month a year ago. Some support also came with report that overseas investors poured in more than Rs 20,400 crore in the domestic capital market in the first half of March, mainly driven by positive global cues.

Global cues too remained supportive with Asian markets trading mostly in green at this point of time, buoyed by speculation the US Federal Reserve will sound decidedly dovish at its policy meeting later in the week. The US markets ended in green on Friday on positive signs regarding trade talks between the US and China as well as UK lawmakers voted to delay a potentially chaotic exit from the European Union.

Back home, industry body Assocham released a charter of demands to make India a $5 trillion economy by 2025. Listing out the charter, Assocham in a statement said it wants political parties to pledge, among other steps, to enable growth rate of 8-8.5 per cent per annum. On the sectoral front, banking sector stocks remained in focus with credit rating agency ICRA’s statement that reduced net non-performing assets will drive considerable improvement in solvency of public sector banks (PSBs). Slippages will reduce during FY20 and reach levels of 1.9-2.4%, which is acceptable.

The BSE Sensex is currently trading at 38338.13, up by 313.81 points or 0.83% after trading in a range of 38131.20 and 38369.59. 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 0.59%, while Small cap index was up by 0.56%.

The top gaining sectoral indices on the BSE were Energy up by 1.67%, Oil & Gas up by 1.62%, Bankex up by 1.33%, Power up by 1.23% and Realty up by 1.13%, while Healthcare down by 0.24% and Auto down by 0.17% were the only losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 2.13%, Power Grid Corporation up by 2.00%, Tata Motors up by 2.00%, Kotak Mahindra Bank up by 1.79% and Reliance Industries up by 1.77%. On the flip side, Maruti Suzuki down by 2.75%, Vedanta down by 0.86%, Sun Pharma down by 0.79%, HCL Tech down by 0.32% and Infosys down by 0.15% were the top losers.

Meanwhile, in order to make India a $5 trillion economy by 2025, Industry body Associated Chambers of Commerce and Industry of India (ASSOCHAM) has come out with charter of demands and called on political parties to incorporate the same in their Lok Sabha poll manifestos. It wants political parties to pledge, among other steps, to enable growth rate of 8-8.5% per annum. Some of demands that Assocham wants political parties to incorporate in their 2019 election manifestoes include simplification of Goods and Services Tax (GST) structure, time bound dilution of government stake in Public Sector Undertaking (PSUs), providing tax rebate of 1% to companies that offer over 20% jobs for women and cut in corporate income tax for Micro, Small & Medium Enterprises (MSME) sector.

ASSOCHAM further suggested expeditious roll-out of Ayushman Bharat and reducing education cost by minimising GST on outsourced education services from 18% to 5%. It has recommended creation of development finance institutions to provide long term non-bank funding option to the industry to boost economic growth and investment. To improve farmers’ income, it suggested the exemption of GST on leasing services for farm equipment and machinery, as well as creation of Technology Up-gradation Fund (TUF) for agriculture to provide capital subsidy. In order to boost manufacturing, it has pitched for gradual simplification of GST structure aiming for dual rate slab 8% and 16%.

The industry body has also recommended reduction in the corporate income tax to 15% from present 25% for the Micro, Small and Medium Enterprises (MSME) over a period of 5 years and 20% from present 30% for large companies over a period of 5 years. Among other steps, it has suggested taxing income from renting of housing properties at a flat rate of 10%, deduction from rental income under Section 24(a) to be increased from 30% to 50% to improve Rate of Return from renting. It recommended exemption of long term capital gain on securities held for 3 years and more and an additional 50 lakh limit be given under Section 54EC for investment in CPSE ETFs bond market.

The CNX Nifty is currently trading at 11514.90, up by 88.05 points or 0.77% after trading in a range of 11468.25 and 11530.15. There were 37 stocks advancing against 13 stocks declining on the index.

The top gainers on Nifty were Indian Oil Corporation up by 3.88%, HPCL up by 2.40%, Axis Bank up by 2.24%, Tata Motors up by 2.11% and Reliance Industries up by 1.88%. On the flip side, Maruti Suzuki down by 2.74%, Grasim Industries down by 1.77%, Vedanta down by 1.17%, Sun Pharma down by 0.76% and Wipro down by 0.55% were the top losers.

Asian markets are trading mostly in green; Nikkei 225 surged 152.40 points or 0.71% to 21,603.25, Straits Times jumped 13.08 points or 0.41% to 3,213.26, Hang Seng increased 211.99 points or 0.73% to 29,224.25, Taiwan Weighted gained 44.85 points or 0.43% to 10,484.09, Jakarta Composite added 24.02 points or 0.37% to 6,485.20 and Shanghai Composite was up by 38.20 points or 1.26% to 3,059.95. On the flip side, KOSPI was down by 0.46 points or 0.02% to 2,175.65.