Sensex, Nifty trade near neutral lines in late morning session

Indian equity benchmarks were trading near their neutral lines in late morning session, with both Sensex and Nifty holding marginal gains. Traders took some support with a survey report stating that notwithstanding the COVID-19 second wave hitting the nation hard, Indian organisations have displayed resilience, and the salary increment is being projected to grow from an average of 8.8 per cent this year to an estimated average of 9.4 per cent in 2022. However, gains were limited, as Fitch Ratings has said India continues to lag way behind in COVID vaccination, and the negative outlook on sovereign rating signifies the rising debt-to-GDP ratio.

On the global front, Asian markets were trading mixed, after Taiwan's consumer price inflation increased in August. The data released by the Directorate General of Budget, Accounting & Statistics revealed that consumer prices rose 2.36 percent year-on-year in August, following 1.95 percent increase in July. The indices for fuels and lubricants surged 23.24 percent due to a relatively lower comparison base and the index for transportation fees rose 13.1 percent due to the increase in airfares.

The BSE Sensex is currently trading at 58288.86, up by 9.38 points or 0.02% after trading in a range of 58169.36 and 58372.94. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.74%, while Small cap index was up by 0.69%.

The top gaining sectoral indices on the BSE were Telecom up by 1.22%, Bankex up by 0.89%, Power up by 0.74%, Oil & Gas up by 0.72% and PSU up by 0.71%, while IT down by 0.66%, TECK down by 0.48%, Auto down by 0.27%, Healthcare down by 0.15% and FMCG down by 0.01% were the top losing indices on BSE.

The top gainers on the Sensex were Kotak Mahindra Bank up by 1.59%, Indusind Bank up by 1.32%, SBI up by 1.25%, Axis Bank up by 0.91% and Bharti Airtel up by 0.85%. On the flip side, TCS down by 1.38%, NTPC down by 1.34%, Nestle down by 1.31%, Maruti Suzuki down by 1.01% and Bajaj Auto down by 0.86% were the top losers.

Meanwhile, with an aim to guard domestic manufacturers from cheap imports, the commerce ministry's investigation arm -- the Directorate General of Trade Remedies (DGTR) has recommended the imposition of anti-dumping duty on Vitamin C, used by pharmaceutical firms for medicine production, from China. The DGTR has concluded in its probe that the imports from China are entering the domestic market at price below the level of the selling price, and even the cost of sales. The domestic industry has been impacted due to the dumped imports.

It added ‘Accordingly, definitive anti-dumping duty...is recommended to be imposed for five years from the date of the notification to be issued by the Central Government, on all imports of goods...originating in or exported from China’. The DGTR has recommended $3.2 per kg and $3.55 per kg duty on imports. The finance ministry takes the final decision to impose the duty. In international trade parlance, dumping happens when a country or a firm exports an item at a price lower than the price of that product in its domestic market. Dumping impacts the price of that product in the importing country, hitting the margins and profits of the manufacturing firms.

According to global trade norms, a country is allowed to impose tariffs on such dumped products to provide a level-playing field to domestic manufacturers. The duty is imposed only after a thorough investigation by a quasi-judicial body, such as DGTR, in India. The imposition of anti-dumping duty is permissible under the World Trade Organization (WTO) regime. India and China are members of this Geneva-based organisation, which deals with global trade norms. The duty is aimed at ensuring fair trading practices and creating a level-playing field for domestic producers vis-a-vis foreign producers and exporters.

The CNX Nifty is currently trading at 17366.25, up by 4.15 points or 0.02% after trading in a range of 17324.00 and 17383.40. There were 26 stocks advancing against 24 stocks declining on the index.

The top gainers on Nifty were Grasim Industries up by 3.03%, BPCL up by 2.17%, UPL up by 2.11%, Kotak Mahindra Bank up by 1.65% and Indusind Bank up by 1.41%. On the flip side, Divi's Lab down by 1.99%, SBI Life Insurance down by 1.45%, TCS down by 1.43%, NTPC down by 1.25% and Eicher Motors down by 1.22% were the top losers.

Asian markets were trading mixed; Nikkei 225 surged 256.25 points or 0.86% to 29,916.14, Hang Seng increased 190.00 points or 0.73% to 26,353.63, Shanghai Composite gained 54.73 points or 1.51% to 3,676.59 and Straits Times advanced 7.45 points or 0.24% to 3,108.53. On the flip side, Jakarta Composite lost 14.54 points or 0.24% to 6,112.40, KOSPI fell 15.91 points or 0.5% to 3,187.42 and Taiwan Weighted dropped 66.43 points or 0.38% to 17,428.87.