Local equities hold notable gains in morning deals

Indian equity markets continued to trade with notable gains in the morning trades, with Sensex and Nifty gaining around 150 and 30 points, respectively. Traders remain energized with Asian Development Bank’s report that India's growth is set to pick up and is expected to grow 7.2% in the current fiscal on strengthening consumption. Traders also took some encouragement form a private report that India-Mexico bilateral trade has crossed $10 billion in 2018 making Mexico the most important trading partner of India in Latin American region surpassing Brazil. Traders shrugged off World Trade Organisation’s forecast which showed that Global trade growth is expected to be lower in 2019 than it was last year, citing widespread ‘tensions’ and economic uncertainty. The WTO had in its preliminary estimates predicted a 3.7% expansion of trade for this year, but has revised that down to 2.6 per cent, marking a decline on the three-percent growth recorded in 2018.

On the global front, Asian markets were trading in green, following a report that said the US and China are closer to reaching a trade agreement. Back home, International Monetary Fund reported that Global growth in 2019 should be even slower than previously expected but a ‘precarious’ rebound later this year is likely. It added the world economy was vulnerable to shocks from BREXIT, high debt levels and trade tensions, as well as unease on financial markets.

The BSE Sensex is currently trading at 39207.61, up by 150.96 points or 0.39% after trading in a range of 39141.09 and 39266.85. There were 23 stocks advancing against 8 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.46%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Realty up by 1.71%, Metal up by 1.07%, Basic Materials up by 0.67%, Consumer Durables up by 0.60% and Power up by 0.46%, while Oil & Gas down by 0.59%, TECK down by 0.42%, IT down by 0.42% were the few losing indices on BSE.

The top gainers on the Sensex were Tata Steel up by 2.09%, HCL Tech up by 1.84%, IndusInd Bank up by 1.78%, Maruti Suzuki up by 1.64% and Vedanta was up by 1.39%. On the flip side, Infosys down by 0.70%, TCS down by 0.70%, Bajaj Auto down by 0.53%, Larsen & Toubro down by 0.34% and Coal India was down by 0.21% were the top losers.

Meanwhile, in order to ease the burden of levies on the telecom sector, and issues including cut in licence fee and spectrum charges should be taken up at the earliest, Cellular Operators Association of India (COAI), an industry body representing telecom companies, has said the new government post elections should set out a clear roadmap preferably in 6-9 months' timeframe. COAI stated that revenue continues to remain under pressure for the industry saddled with high debt, and for most players the earnings before interest, tax, depreciation and amortization or EBITDA generated is not enough to meet the interest expenses.

The industry body further said that income from interest, dividend, capital gains from sale of fixed assets, gains from forex fluctuation, income from rent, insurance claims, and distributors margin should not be included in the revenue of the telecom operators for the purpose of computation of licence fee and spectrum usage charges. Moreover, revenue from sale of handsets and other subscriber terminals like routers should also be not included in the AGR.

Besides, COAI’s Director General Rajan S Mathews has said the definition of adjusted gross revenue (AGR) should be reviewed to include revenue from licensed activities only ... Telecom Department should adopt the recommendations given by the regulator on the issue of determination of AGR. He added that if these outstanding issues are dealt with in the first 6-9 months by the new government post elections, it will yield sizable benefits for the industry. It will also send a clear signal to both industry and investors that the government is serious about getting the sector back on its feet.

The CNX Nifty is currently trading at 11747.15, up by 33.95 points or 0.29% after trading in a range of 11731.10 and 11761.00. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Indiabulls Housing up by 3.03%, Tata Steel up by 2.64%, IndusInd Bank up by 2.03%, JSW Steel up by 1.93% and HCL Tech was up by 1.77%. On the flip side, BPCL down by 2.83%, Indian Oil Corporation down by 2.02%, Eicher Motors down by 1.67%, Zee Entertainment down by 1.42% and Tech Mahindra was down by 1.30% were the top losers.

All Asian markets were trading in green, Hang Seng increased 285.90 points or 0.97% to 29,910.57, Taiwan Weighted strengthened 21.81 points or 0.2% to 10,712.11, Nikkei 225 surged 208.30 points or 0.97% to 21,713.61, Straits Times advanced 26.34 points or 0.8% to 3,306.12, Shanghai Composite gained 7.36 points or 0.23% to 3,184.18 and KOSPI was up by 16.58 points or 0.76% to 2,193.76.