Markets trade lower in early deals; Tata Steel leads loser on BSE

Indian equity benchmarks made negative start on Wednesday amid increased geopolitical tensions following reports of civilian killings in Poland from Russian missiles. Markets are trading lower with cut of around 0.20% each in early deals. Traders were concerned as data released by the commerce ministry showed that India's merchandise trade deficit widened to $26.91 billion in October as exports crashed by 17 percent year-on-year to $29.78 billion while imports rose by 6 percent. The trade deficit stood at $17.91 billion in October 2021. Some pessimism also came in as foreign institutional investors (FIIs) have net offloaded shares worth Rs 221.32 crore on Tuesday, according to the provisional data available on the NSE. Though, downside remained capped as the Central Board of Direct Taxes (CBDT) chairman Nitin Gupta said direct tax collections are likely to be 25-30% more than the budget estimate (BE) of Rs 14.2 trillion for the current fiscal.

Most of the Asian markets are trading lower, despite the broadly positive cues from Wall Street overnight, as traders ponder on the impact of the geopolitical situation following reports of Russian missile strikes crossing into Poland and killing two people. Besides, the value of core machine orders in Japan was down a seasonally adjusted 4.6 percent on month in September. Meanwhile, data showing a smaller than expected increase in U.S. producer prices further raised hopes the US Fed will slow the pace of interest rate hikes as soon as next month.

Back home, mineral industry stocks were in focus as the mines ministry's report showed that the nation's mineral production increased by 4.6 per cent in September compared to the same month last year. In stock specific development, Bharat Electronics rose after the company signed 4 separate MoUs to supply defence equipment.

The BSE Sensex is currently trading at 61754.18, down by 118.81 points or 0.19% after trading in a range of 61708.63 and 61911.91. There were 12 stocks advancing against 18 stocks declining on the index.

The broader indices were trading mixed; the BSE Mid cap index fell 0.09%, while Small cap index was up by 0.20%.

The top gaining sectoral indices on the BSE were IT up by 0.62%, TECK up by 0.45%, Industrials up by 0.10%, Auto up by 0.06%, while Metal down by 0.75%, Utilities down by 0.60%, Realty down by 0.60%, Oil & Gas down by 0.57%, FMCG down by 0.56% were the top losing indices on BSE.

The top gainers on the Sensex were Dr. Reddy's Lab up by 1.55%, TCS up by 0.73%, Maruti Suzuki up by 0.67%, Wipro up by 0.60% and Tech Mahindra up by 0.57%. On the flip side, Tata Steel down by 1.38%, Bajaj Finserv down by 1.34%, Bajaj Finance down by 1.27%, ITC down by 0.96% and Hindustan Unilever down by 0.91% were the top losers.

Meanwhile, expressing optimism over tax collection, Central Board of Direct Taxes (CBDT) Chairman Nitin Gupta has said that the direct tax collection in the current fiscal is likely to exceed the budget target of Rs 14.20 lakh crore by about 30 per cent. He also said that the Budget for next fiscal could bring about some tweaks in the TDS provision for online gaming to check tax evasion.

He said ‘Currently there is a provision for deduction of TDS on online gaming. There is existing provision, if it needs to be modified or retained in the same way that needs to be seen’. Currently, a 10 per cent Tax Deduction at Source (TDS) is levied on income from online gaming. He further said that given the current buoyancy in collections, the Budget target for the next fiscal (2023-24) is also likely to be higher.

He further said a 25-30 per cent growth in tax collection would take the net direct tax mop-up for current fiscal at Rs 17.75-Rs 18.46 lakh crore. The gross direct tax collections between April 1-November 10 stood at Rs 10.54 lakh crore, registering a growth of 31 per cent. Net collections, after adjusting refunds, stood at Rs 8.71 lakh crore, which is 61.31 per cent of the Budget estimates (BE) for the full year tax collection target.

The Chairman also said that with online gaming coming in limelight, the tax department is working to see how a better audit trail can be established for money spent and earned from such online activities. He added ‘Online gaming and betting is a new kid on the block and new will take a view at the stage of budget preparation and see how evasion can be controlled, and at the same time making it easy for taxpayer to maintain accounts and pay taxes’. He said the department is creating audit trail and presenting transaction information to the taxpayers.

The CNX Nifty is currently trading at 18365.55, down by 37.85 points or 0.21% after trading in a range of 18354.70 and 18417.65. There were 16 stocks advancing against 34 stocks declining on the index.

The top gainers on Nifty were Dr. Reddy's Lab up by 1.67%, Cipla up by 1.09%, TCS up by 0.79%, Adani Enterprises up by 0.77% and Maruti Suzuki up by 0.65%. On the flip side, Tata Steel down by 1.52%, Bajaj Finserv down by 1.50%, Divi's Lab down by 1.45%, Bajaj Finance down by 1.29% and Apollo Hospital down by 1.20% were the top losers.

Asian markets are trading mostly in red; Straits Times fell 1.15 points or 0.04% to 3,274.13, Hang Seng slipped 120.47 points or 0.66% to 18,222.65, KOSPI declined 1.22 points or 0.05% to 2,479.11, Jakarta Composite lost 66.98 points or 0.95% to 6,968.52 and Shanghai Composite was down by 6.75 points or 0.22% to 3,127.33. On the other hand, Nikkei 225 rose 41.48 points or 0.15% to 28,031.65 and Taiwan Weighted was up by 7.93 points or 0.05% to 14,554.24.