Markets trade higher in early deals; Utilities, Power lead

Indian equity benchmarks made positive start on Thursday amid mixed global cues. Markets are trading higher in early deals with marginal gains on account of buying in Utilities, Power and Industrials stocks. Market participants are eyeing macro-economic data -- Industrial production for June and CPI inflation for August to be released later in the day. Traders took encouragement as Commerce Secretary BVR Subrahmanyam said the country's merchandise exports are expected to touch $1 trillion by 2027-28 and the government has laid down a road map, including district as an export hub scheme, to achieve that number. Some support came as days after the Centre withdrew the retrospective tax amendments that led to international arbitration, Revenue Secretary Tarun Bajaj said it was the government’s policy to provide a stable and predictable tax regime. Traders took note of Commerce and Industry Secretary BVR Subrahmanyam’s statement that India will fast-track free trade agreements (FTAs) with at least six nations - including the UAE, the UK, Australia, Canada, and the EU - over the next few months, in line with its revamped foreign trade strategy. However, upside remained capped as India recorded 43,641 new Covid-19 cases and 519 deaths in the past 24 hours, taking its tally to 32,076,974 and the death toll to 429,702.

On the global front, Asian markets are trading mixed at this point of time following the mixed cues overnight from Wall Street, on rising oil prices and optimism on the outlook for interest rates after data showing a slowdown in U.S. inflation suggested the Fed might not be in a hurry to tighten policy for now. Traders also remained concerned about the rapid spread of the delta variant of the coronavirus in the region. Back home, Retail, hospitality stocks were in focus as hotels, restaurants and malls can function in Maharashtra till 10 p.m. from August 15 as a part of new relaxation measures announced by the state government. In scrip spcificc development, PTC India traded higher as it reported an over 36 per cent jump in consolidated net profit to Rs 136.17 crore for the June 2021 quarter.

The BSE Sensex is currently trading at 54611.26, up by 85.33 points or 0.16% after trading in a range of 54536.65 and 54702.13. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.37%, while Small cap index was up by 1.15%.

The top gaining sectoral indices on the BSE were Utilities up by 1.21%, Power up by 0.77%, Industrials up by 0.72%, Basic Materials up by 0.70%, PSU up by 0.60%, while Bankex down by 0.16% was the sole losing index on BSE.

The top gainers on the Sensex were Power Grid up by 3.07%, Mahindra & Mahindra up by 1.45%, ITC up by 1.32%, Tech Mahindra up by 1.25% and Ultratech Cement up by 1.06%. On the flip side, Axis Bank down by 0.57%, Kotak Mahindra Bank down by 0.49%, Dr. Reddy's Lab down by 0.34%, Indusind Bank down by 0.29% and HDFC Bank down by 0.22% were the top losers.

Meanwhile, days after the Centre government withdrew the retrospective tax amendments that led to international arbitration, Revenue Secretary Tarun Bajaj said it was the government’s policy to provide a stable and predictable tax regime. He stated that robust tax revenues in the first quarter of the current fiscal were encouraging but urged industry to revive the ‘animal spirit’ as far as private investment is concerned.

He stated ‘This is now the government’s policy to give a stable and predictable tax regime. This emanates from 2019. We came up with lower tax rates for the corporate sector, and also lower taxes for new units that would be set up by 2023’. He added ‘So the whole idea is to give the corporate sector time to plan itself, and give it a stable tax regime so that you're able to decide on other things like, whether you want to invest, where you want to invest and how you want to invest. He asked industry to come forward to invest, manufacture, start services and tell the government about what it requires from it.

The government, last week, introduced the Taxation Laws (Amendment) Bill, 2021, to withdraw retrospective tax demands made using a 2012 legislation on indirect transfer of Indian assets and also refund the amount paid in these cases without any interest. On industry’s demands for reduction of goods and services (GST) rates on certain items, Bajaj pointed out that the council would look at solutions to bring down the rates. It would take out certain items from the tax-exempt category and correct the inverted duty structure in the upcoming meetings.

The CNX Nifty is currently trading at 16302.10, up by 19.85 points or 0.12% after trading in a range of 16286.90 and 16329.80. There were 29 stocks advancing against 21 stocks declining on the index.

The top gainers on Nifty were Power Grid up by 2.75%, Mahindra & Mahindra up by 1.64%, Tech Mahindra up by 1.27%, Adani Ports & SEZ up by 1.27% and Shree Cement up by 1.25%. On the flip side, Indusind Bank down by 0.59%, Axis Bank down by 0.54%, Kotak Mahindra Bank down by 0.46%, SBI down by 0.46% and Dr. Reddy's Lab down by 0.33% were the top losers.

Asian markets are trading mixed; Nikkei 225 added 5.28 points or 0.02% to 28,075.79, Straits Times rose 13.95 points or 0.44% to 3,193.95 and Jakarta Composite surged 27.06 points or 0.44% to 6,115.47. On the other hand, Hang Seng fell 17.37 points or 0.07% to 26,642.79, Taiwan Weighted declined 46.34 points or 0.27% to 17,180.84, KOSPI lost 4.89 points or 0.15% to 3,215.73 and Shanghai Composite was down by 4.35 points or 0.12% to 3,528.27.