Markets trade marginally lower amid weak global cues

Indian equity benchmarks made slightly positive start but soon slipped into negative territory in early deals on Tuesday. Markets are trading lower with marginal losses, tracking weakness in Asian peers. Selling in IT, TECK and Metal stocks weighted on sentiments, while gains in Telecom, Healthcare and Consumer Durables kept downside in check. Initial gains were support by Chief Economic Advisor KV Subramanian’s statement that the current slowdown in the Indian economy is more cyclical than structural in nature and the government has a well-thought-out agenda for reforms. He noted that the country's potential growth remains unaltered and things will improve soon. However, traders turned cautious with report that the Central GST collection fell short of the budged estimate by nearly 40 per cent during the April-November period of 2019-20. Adding some pessimism among market participants with a private report indicating that India is expected to witness a marginal 7 per cent rise in job creation in the October-March period of this financial year, as subdued economic conditions have dampened employment outlook.

On the global front, most of the Asian markets were trading lower with investors turning cautious amid lingering uncertainty about a trade deal between the US and China before the next round of tariffs on Chinese goods set to take effect on December 15. Trading activity also remained subdued ahead of the US Federal Reserve's monetary policy announcement due on Wednesday.

Back home, telecom stocks were trading higher with CRISIL Ratings’ report that a tariff uptick of upto 50% in the telcom sector may double the industry's operating revenue by next fiscal. The rating firm concluded that revised tariffs will improve the average revenue per user (ARPU)- a key industry metric and every Rs one increase in ARPU will add to Rs 1000 crore to industry's EBIDTA. In scrip specific development, HDFC gained amid report that it is proposing to acquire 1,14,70,000 shares representing 9.12% of the equity share capital of its subsidiary HDFC Credila Financial Services from its other promoters for amount not exceeding Rs 395 crore. However, Yes Bank came under pressure ahead of its board meeting to decide on the details of preferential allotment of shares.

The BSE Sensex is currently trading at 40416.23, down by 71.20 points or 0.18% after trading in a range of 40414.76 and 40588.81. There were 11 stocks advancing against 20 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index declined 0.15%, while Small cap index was down by 0.03%.

The few gaining sectoral indices on the BSE were Telecom up by 0.49%, Healthcare up by 0.22%, Consumer Durables up by 0.14% and Oil & Gas was up by 0.02%, while IT down by 0.88%, TECK down by 0.71%, Metal down by 0.48%, Energy down by 0.30% and Realty was down by 0.27% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma Industries up by 1.42%, ONGC up by 1.11%, Hindustan Unilever up by 0.95%, Bharti Airtel up by 0.89% and HDFC up by 0.68%. On the flip side, Yes Bank down by 2.76%, TCS down by 1.39%, Tata Motors - DVR down by 0.98%, Mahindra & Mahindra down by 0.84% and Indusind Bank down by 0.81% were the top losers.

Meanwhile, Minister of State for Finance Anurag Singh Thakur has said the Central Goods and Services Tax (GST) collection fell short of the budged estimate by nearly 40% during the April-November period of 2019-20. The actual CGST collection during April-November stood at Rs 3,28,365 crore, while the budgeted estimate is of Rs 5,26,000 crore for these months. However, he added that the data was provisional.

In 2018-19, the actual CGST collection stood at Rs 4,57,534 crore as against the provisional estimate of Rs 6,03,900 crore for the year. In 2017-18, the CGST collection was Rs 2,03,261 crore. The minister said that as many as 999 cases were registered till October in the current fiscal for GST evasion and Rs 8,134.39 crore has been recovered. During 2018-19, a total of Rs 19,395.26 crore were recovered (1473 cases) and in 2017-18 the recovery was of Rs 757.81 crore (148 cases).

Thakur said for strengthening monitoring tools to prevent GST evasion, emphasis has been laid on system based analytical tools and system generated intelligence. In this connection, the Directorate General of Analytics and Risk Management (DGARM) has been set up by the CBIC. Further, E- way bill squads have been activated for the purposes of random verification of the goods in transit.

He also said that it has inserted a new Central GST rule which puts restriction that the input tax credit (ITC) availed by a taxpayer shall not exceed 20% of the eligible credit available in respect of invoices or debit notes. The capping of ITC would lead to reduction in cases of fraudulent ITC availment as well as increase in payment of tax through cash thereby boosting GST collection.

The CNX Nifty is currently trading at 11926.25, down by 11.25 points or 0.09% after trading in a range of 11910.75 and 11953.20. There were 21 stocks advancing against 29 stocks declining on the index.

The top gainers on Nifty were Sun Pharma Industries up by 1.73%, Cipla up by 1.32%, UPL up by 1.09%, Bharti Airtel up by 1.03% and Tata Motors up by 0.81%. On the flip side, Zee Entertainment down by 1.99%, TCS down by 1.44%, Bharti Infratel down by 1.13%, Wipro down by 1.04% and Ultratech Cement down by 1.02% were the top losers.

Asian markets were trading mostly in red; Taiwan Weighted dropped 49.60 points or 0.43% to 11,611.17, Hang Seng decreased 23.15 points or 0.09% to 26,471.58, Nikkei 225 slipped 15.90 points or 0.07% to 23,414.80, Jakarta Composite lost 6.86 points or 0.11% to 6,186.93 and Shanghai Composite declined 5.89 points or 0.2% to 2,908.59. On the flip side, Straits Times advanced 2.73 points or 0.09% to 3,182.55 and KOSPI was up by 3.34 points or 0.16% to 2,091.99.