Key gauges trade flat with positive bias in morning deals

Indian equity benchmarks traded flat with a positive bias in morning deals led by gains in Healthcare, IT and TECK stocks. Traders got some support with Finance Minister Nirmala Sitharaman’s statement that the rules for the recent taxation amendment bill will be framed soon. She said we will have to wait for the rules to be framed under the recent taxation amendment bill. Some support also came with report that investments by private equity and venture capital funds doubled to a record high of $9.5 billion in July mainly driven by higher investor interest in the e-commerce sector. Private equity (PE) and venture capital (VC) investments stood at $4.1 billion in the year-ago period. However, traders got anxious with Federation of Indian Export Organisations (FIEO) Director General Ajay Sahai’s statement that with Kabul falling into the hands of the Taliban, bilateral trade between Afghanistan and India will get impacted significantly in these uncertain times.

On the global front, Asian markets were trading mostly in red as growing anxiety over the spike in the Delta variant of COVID-19 infections and turmoil in Afghanistan eclipsed overnight strength on Wall Street. Back home, on the sectoral front, Tyre industry’s stocks remained in focus as automotive Tyre Manufacturers Association (ATMA) asked the government to allow duty-free import of natural rubber as shortage of the commodity in India has become a major deterrent for the tyre industry to support domestic manufacturing.

The BSE Sensex is currently trading at 55625.26, up by 42.68 points or 0.08% after trading in a range of 55415.63 and 55688.50. There were 18 stocks advancing against 12 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.45%, while Small cap index was up by 0.47%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.18%, IT up by 1.00%, TECK up by 0.86%, FMCG up by 0.84% and Capital Goods up by 0.40%, while, Bankex down by 0.61%, Auto down by 0.56%, Realty down by 0.31%, PSU down by 0.12% and Oil & Gas down by 0.07% were the top losing indices on BSE.

The top gainers on the Sensex were Tech Mahindra up by 3.47%, Asian Paints up by 1.77%, Nestle up by 1.52%, Hindustan Unilever up by 1.40% and Power Grid Corporation up by 1.19%. On the flip side, Indusind Bank down by 1.98%, Axis Bank down by 1.12%, HDFC Bank down by 1.09%, Mahindra & Mahindra down by 1.04% and Maruti Suzuki down by 0.64% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman expects inflation to remain in the prescribed range during the current fiscal (FY22) and the government is regularly monitoring the price movement of essential items. The RBI has been mandated to keep inflation at 4 per cent, with a tolerance level of 2 per cent on either side. She said the Group of Ministers is actively monitoring price movement of essential items like edible oil, pulses, fruits and vegetables, meat etc.

The minister appreciated that states have been very cooperative in terms of going after hoarders and black marketeers. She also said various efforts taken by the government are expected to keep inflation benign and it is expected to remain within the target. She expressed confidence that the revenue would be buoyant in the coming months. Both Goods and Services Tax (GST) and direct taxes have improved in the past few months.

Sitharaman has said that the GST collection this year has improved substantially and as a result there are chances that the government may be able to pay compensation to states from revenue collected. About extending compensation beyond July 2022, she said the GST Council will decide about the issue.

The CNX Nifty is currently trading at 16575.25, up by 12.20 points or 0.07% after trading in a range of 16516.60 and 16591.40. There were 30 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 3.33%, Tata Consumer Product up by 3.31%, Asian Paints up by 1.88%, Hindustan Unilever up by 1.56% and Nestle up by 1.50%. On the flip side, Indusind Bank down by 1.98%, HDFC Bank down by 1.21%, Mahindra & Mahindra down by 1.16%, Axis Bank down by 1.00% and Grasim Industries down by 0.87% were the top losers. 

Asian markets were trading mostly in red; Hang Seng decreased 178.80 points or 0.68% to 26,002.66, Taiwan Weighted dropped 163.26 points or 0.97% to 16,695.51, KOSPI fell 23.40 points or 0.74% to 3,147.89, Straits Times trembled 20.00 points or 0.64% to 3,125.52 and Shanghai Composite declined 16.91 points or 0.48% to 3,500.43. On the flip side, Nikkei 225 surged 1.16 points or 0% to 27,524.35.