Benchmarks trade flat with positive bias in early deals

Indian equity benchmarks made slightly positive start but soon turned volatile on Monday. Markets were trading flat with positive bias in early deals. Gains in consumer goods and metal shares were offset by losses in banking and IT shares. Early optimism came with Union Road Transport and Highways Minister Nitin Gadkari’s statement that the goal of making India a $5 trillion economy by 2024 was difficult but not impossible. He added that it can be achieved by increasing domestic production and reducing dependence on imports. Some support also came with report that the government is working vigorously on import substitution to promote micro, small and medium enterprises (MSMEs) and encourage local manufacturing. However, traders turned cautious with former finance secretary Subhash Chandra Garg’s statement that the government's tax collection is likely to fall short of its estimate by Rs2.5 lakh crore or 1.2% of GDP in 2019-20, and called for scrapping of dividend distribution tax. Meanwhile, the tax department has raised GST collection target to Rs 1.15 lakh crore over the next two months and Rs 1.25 lakh crore for March month by checking fraudulent input tax credit claims.

On the global front, Asian markets were trading mixed despite the record highs on Wall Street Friday, with the focus now turning to the release of corporate earnings results this week. Nevertheless, upbeat economic data from China and the US last week has boosted investor sentiment. Back home, aviation stocks were in focus as the government is considering levying specific rate of excise duty on aviation turbine fuel (ATF) in place of current ad valorem rates to insulate its prices from cascading effect in times of volatile prices, with no sight of including jet fuel in Goods and Services Tax (GST) in near future. In stock specific development, TCS fell after reporting a flat December quarter net profit at Rs 8,118 crore and also made it clear that it will not be able to notch a double-digit revenue growth in 2019-20.

The BSE Sensex is currently trading at 41966.89, up by 21.52 points or 0.05% after trading in a range of 41923.67 and 42273.87. There were 17 stocks advancing against 12 stocks declining on the index, while 1 stock remains unchanged on the index on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.25%, while Small cap index was up by 0.24%.

The top gaining sectoral indices on the BSE were Power up by 1.89%, Utilities up by 1.60%, PSU up by 0.61%, Metal up by 0.54% and Realty was up by 0.49%, while IT down by 0.41%, TECK down by 0.40%, Energy down by 0.26%, Telecom down by 0.11% and Bankex was down by 0.08% were the top losing indices on BSE.

The top gainers on the Sensex were Power Grid Corporation up by 4.36%, Asian Paints up by 1.22%, ITC up by 1.19%, HDFC up by 0.80% and Mahindra & Mahindra up by 0.62%. On the flip side, HCL Tech down by 1.42%, Kotak Mahindra Bank down by 0.93%, TCS down by 0.89%, Bharti Airtel down by 0.72% and HDFC Bank down by 0.65% were the top losers.

Meanwhile, expressing optimism over India’s economy target, Union Road Transport and Highways Minister Nitin Gadkari has said that the goal of making India a $5 trillion economy by 2024 was ‘difficult but not impossible’. He also said it can be achieved by increasing domestic production and reducing dependence on imports.

He said ‘Our country has plenty of resources and production capacity. Despite that we are spending crores every year on importing goods like medicines, medical devices, coal, copper, papers, etc,’. He added that ‘If we want to become a $5 trillion economy, we have to increase the domestic production of these things instead of importing them’.

Referring to the current economic slowdown, Gadkari said ‘We are the fastest growing economy in the world. But there is a cycle in the business. Challenges crops up, at times due to the global economy and sometimes because of a gap in demand and supply. But I see India's future in the leaders of younger generation who can turn difficulties and challenges into opportunities.’

The minister noted that there was no dearth of capital, resources and technology in the country, but there is definitely a lack of right vision and leadership in different fields. He said exports will be encouraged by focusing on increasing the participation of Micro, Small and Medium Enterprises (MSMEs) in the development.

The CNX Nifty is currently trading at 12354.15, up by 1.80 points or 0.01% after trading in a range of 12340.30 and 12430.50. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Power Grid Corporation up by 4.23%, BPCL up by 1.78%, Bharti Infratel up by 1.67%, Asian Paints up by 1.28% and ITC up by 1.10%. On the flip side, Indian Oil Corporation down by 3.79%, HCL Tech down by 1.50%, Zee Entertainment down by 1.38%, TCS down by 1.25% and Wipro down by 1.10% were the top losers.

Asian markets are trading mixed; Nikkei 225 surged 61.41 points or 0.26% to 24,102.67, Taiwan Weighted strengthened 38.93 points or 0.32% to 12,129.22, KOSPI rose 18.43 points or 0.82% to 2,269.00 and Shanghai Composite gained 13.09 points or 0.43% to 3,088.59. On the flip side, Straits Times trembled 8.65 points or 0.26% to 3,272.38, Jakarta Composite lost 12.56 points or 0.2% to 6,279.10 and Hang Seng was down by 113.85 points or 0.39% to 28,942.57.