Lackluster trade continues on Dalal Street

Indian equity benchmarks continued to trade in red zone in early noon session, with Sensex and Nifty trading below at 37,800 and 11,250 levels, respectively. Weak broader indices along with heavy sell off at Metal, Basic Materials and Realty counters dragged the markets lower. Selling in frontline blue chip stocks such as Tata Steel, Vedanta and Bajaj Finance restricted the markets to go up. The mood on the street remained cautious as the International Monetary Fund (IMF) in its World Economic Update has revised downward India’s Gross Domestic Product (GDP) growth forecast by 0.3% for 2019 and 2020 to 7.0% and 7.2%, respectively, over its previous projections early this year. It said the downward revision for both years reflects a weaker-than expected outlook for domestic demand. However, Finance minister Nirmala Sitharaman signalled that the government may extend the lower corporate tax rate of 25% to all companies, giving India Inc something to cheer about. Her July 5 budget had lowered the rate for most companies but excluded the biggest. Meanwhile, rejecting demands for rollback of import duty on the paper used for printing newspapers, Finance Minister Nirmala Sitharaman said 10 per cent customs duty on imported newsprint was a move to provide a level playing field for domestic manufacturers.

On the global front, Asian markets were trading mixed amid the optimism spread by the positive earnings and speculation peaked that US and Chinese negotiators will hold face-to-face trade talks soon. Back on street, in scrip specific developments, shares of Karur Vysya Bank edged lower despite the bank reporting 58.83% rise in its net profit at Rs 72.92 crore for the quarter ended June 30, 2019 as compared to Rs 45.91 crore for the same quarter in the previous year. However, HDFC Bank gained on inking MoU with CSC, Confederation of All India Traders.

The BSE Sensex is currently trading at 37714.26, down by 268.48 points or 0.71% after trading in a range of 37708.41 and 38102.84. There were 6 stocks advancing against 25 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 1.41%, while Small cap index was down by 0.95%.

The top losing sectoral indices on the BSE were Metal down by 3.24%, Basic Materials down by 2.20%, Realty down by 1.67%, Capital Goods down by 1.67% and Industrials down by 1.61%, while there were no gainers on the sectoral indices.

The top gainers on the Sensex were HDFC up by 1.22%, Hindustan Unilever up by 0.80%, ONGC up by 0.80%, Yes Bank up by 0.72% and SBI was up by 0.25%. On the flip side, Tata Steel down by 3.44%, Vedanta down by 3.36%, Tata Motors - DVR down by 2.93%, Bajaj Finance down by 2.55% and ICICI Bank was down by 2.17% were the top losers.

Meanwhile, the Central Board of Direct Taxes (CBDT) has extended the deadline for filing of Income Tax Return (ITR) for financial year 2018-19 (FY19) by individuals from July 31, 2019 to August 31, 2019. With extension of the deadline, individuals will have more time to file their ITRs without worrying about late filing fees.

Individuals, including salaried taxpayers, and entities - who do not need to get their accounts audited for tax purposes- were required to file their income tax returns for fiscal 2018-19 (Assessment Year 2019-20) by July 31, 2019. There have been demands for an extension in filing ITR date since issuance of tax deducted at source (TDS) statement for 2018-19 fiscal was delayed.

In the month of June, the Income Tax department had extended the deadline for employers to issue Form 16 TDS certificate for financial year 2018-19 to its employees by 25 days till July 10. However, the extension would leave the salaried taxpayers with a limited time-frame of just 20 days to file their income tax returns.

The CNX Nifty is currently trading at 11236.55, down by 94.50 points or 0.83% after trading in a range of 11229.80 and 11359.75. There were 8 stocks advancing against 41 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were HDFC up by 1.25%, Bharti Infratel up by 1.15%, Yes Bank up by 0.94%, Zee Entertainment up by 0.91% and Hindustan Unilever was up by 0.67%. On the flip side, JSW Steel down by 6.04%, Eicher Motors down by 3.82%, Vedanta down by 3.42%, Tata Steel down by 3.26% and BPCL was down by 3.24% were the top losers.

Asian markets were trading mixed; Hang Seng increased 199.11 points or 0.7% to 28,665.59, Nikkei 225 surged 68.00 points or 0.31% to 21,688.88, Straits Times advanced 5.79 points or 0.17% to 3,378.92 and Shanghai Composite was up by 25.54 points or 0.88% to 2,925.48.

On the other hand, Jakarta Composite lost 15.21 points or 0.24% to 6,388.60, Taiwan Weighted dropped 27.65 points or 0.25% to 10,919.61 and KOSPI was down by 18.81 points or 0.9% to 2,082.64.