Benchmarks continue to trade higher in afternoon deals

Key benchmark indices continued to trade higher in the afternoon session on sustained buying, with the Sensex moving over the 38,500 and the Nifty above 11,400 marks. Trading sentiments remained optimistic with Commerce Minister Piyush Goyal’s statement that India does not have any trade disputes with the US, and there is huge bilateral trade potential. He also said that a little uncertainty in any relation is also good for having healthy bilateral relations. The domestic sentiment was also buoyed with Minister of State for Finance Anurag Thakur’s statement that Indian economy is structurally and fundamentally very strong and the current slowdown, which is cyclical in nature, would not affect it much. He also exuded confidence that India would achieve the target of becoming $5 trillion economy by 2024-25. On the sectoral front, select telecom sector stocks were trading in green with industry body COAI stating that the government's assurance on undertaking reforms in the spectrum pricing will spell a ‘big relief’ for telecom companies.

On the global front, Asian markets were trading mixed as the optimism fanned by Donald Trump's much-vaunted China trade deal wore off. Back home, the BSE Sensex is currently trading at 38501.34, up by 286.87 points or 0.75% after trading in a range of 38238.27 and 38503.16. There were 24 stocks advancing against 7 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.41%, while Small cap index was up by 0.10%.

The top gaining sectoral indices on the BSE were Auto up by 1.93%, Consumer Discretionary up by 1.24%, Power up by 1.16%, FMCG up by 1.09% and Bankex was up by 0.97%, while Telecom down by 1.75%, Metal down by 0.73%, TECK down by 0.52%, IT down by 0.41% and Basic Materials was down by 0.28% were the top losing indices on BSE.

The top gainers on the Sensex were Hero MotoCorp up by 2.83%, Maruti Suzuki up by 2.59%, Mahindra & Mahindra up by 2.20%, ONGC up by 2.07% and ITC was up by 1.88%. On the flip side, Bharti Airtel down by 2.35%, Tata Motors down by 2.00%, Infosys down by 1.83%, Tata Motors - DVR down by 1.77% and Tata Steel was down by 1.19% were the top losers.

Meanwhile, Oil Minister Dharmendra Pradhan has urged Finance Minister Nirmala Sitharaman for bringing jet fuel and natural gas under the ambit of Goods and Services Tax (GST) regime to reduce the multiplicity of taxes and improve the business climate. He said ‘I make a strong appeal to Finance Minister to take this up with the GST Council and at least make a beginning by including natural gas and ATF in the GST.’ He said given the complexity of the petroleum sector and the revenue dependence of state governments in this sector, petroleum products-crude oil, natural gas, petrol, diesel, and aviation turbine fuel (ATF)-have been kept outside the purview of GST regime when it was introduced on July 01, 2017.

The Minister has stated that there has been continuous demand from the petroleum industry for the inclusion of petroleum products under the GST regime. He felt that including ATF and natural gas will not just help companies set off tax that they paid on input but will also bring about uniformity in taxation on the fuels in the country. He said ATF accounts for almost half of the cost of an airline and rates vary from state to state depending on local VAT. He added that a uniform GST would also push the usage of environment-friendly natural gas whose share in the energy basket the government wants to increase to 15 percent by 2030 from current 6.2 percent.

Pradhan further said he was confident that GST Council will take a decision on the issue at the appropriate time. He said under the existing structure, these items attract the Centre's excise duty and a state's value-added tax (VAT). Both these and all other levies will get subsumed under GST if they are brought under its ambit. He noted that the decision on their inclusion depends on the financial position of states as revenues from these five petroleum products constitute a substantial chunk of state government finances. He added that barring a few, most of the states are incurring revenue shortfall as GST subsumed a dozen of taxes, introducing the single levy, in a bid to simplify taxation system and remove the cascading effect of 'tax on tax' in the country.

The CNX Nifty is currently trading at 11420.70, up by 79.55 points or 0.70% after trading in a range of 11342.10 and 11420.95. There were 39 stocks advancing against 11 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 4.12%, Hero MotoCorp up by 2.80%, Zee Entertainment up by 2.72%, Maruti Suzuki up by 2.50% and Mahindra & Mahindra was up by 2.29%. On the flip side, JSW Steel down by 2.44%, Bharti Airtel down by 2.41%, Tata Motors down by 2.11%, Infosys down by 1.90% and Tata Steel was down by 1.23% were the top losers.

Asian markets were trading mixed; Nikkei 225 surged 408.34 points or 1.87% to 22,207.21, Taiwan Weighted strengthened 44.85 points or 0.41% to 11,111.80, Jakarta Composite soared 5.07 points or 0.08% to 6,131.95 and KOSPI rose 0.77 points or 0.04% to 2,068.17.

On the flip side, Straits Times trembled 5.04 points or 0.16% to 3,119.41, Shanghai Composite declined 17.12 points or 0.57% to 2,990.76 and Hang Seng decreased 27.09 points or 0.1% to 26,494.76.