Benchmarks manage to end volatile session in green on Thursday

Indian equity benchmarks managed to end volatile session in green on Thursday following gains in select Capital Goods, Industrials and Banking counters. After making cautious start, key gauges traded higher in morning deals, as traders took support with a report that robust GST collections will help achieve the FY23 revenue growth target on the indirect taxes front, despite the impact of duty cuts on central excise and customs mop-up. Sentiments remained positive as the government extended export benefits under the tax refund scheme -- RoDTEP -- to chemicals, pharmaceuticals and products of iron and steel for a specified period with a view to boost shipments of these goods, amidst exports growth recording a contraction of 16.65 per cent in October. However, key gauges trimmed some gains in afternoon deals, as traders got anxious with India Ratings and Research’s (Ind-Ra) latest report stating that the many rising headwinds, both domestic as well as external, are expected to pull down India’s Gross domestic product (GDP) growth to 4-4.5 per cent in the second half of FY2023 (H2FY23), shaving off the better numbers in the first half.

But, markets once again added gains in late afternoon deals, taking support from a report revealed that there is likely to be 90-110 lakh additions to the gig workforce by 2025 with more and more companies preferring to hire employees on project basis.  According to the report, companies have also started investing in gig work platforms and processes, which indicates how integral they are to the future of jobs growth in India. Some optimism also came as Minister of State for Commerce and Industry Som Parkash said that the reforms taken by Government have resulted in increased Foreign Direct Investment (FDI) inflows in the country. FDI inflows in India stood at $45.15 billion in 2014-2015 and have continuously increased since then, and India registered its highest ever annual FDI inflow of $84.84 billion (provisional figures) in the financial year 2021-22.

On the global front, European markets were trading in red, while Asian markets settled mostly lower on Thursday as fears of a global economic slowdown and uncertainty on whether the Federal Reserve will slow the pace of its interest rate hikes largely offset optimism over easing of strict COVID containment measures in China. Markets also keenly awaited U.S. inflation data as well as the outcome of the Fed and ECB policy meetings next week for further clues on the direction of monetary policy.

Finally, the BSE Sensex rose 160.00 points or 0.26% to 62,570.68 and the CNX Nifty was up by 48.85 points or 0.26% to 18,609.35.

The BSE Sensex touched high and low of 62,633.56 and 62,320.18, respectively. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices ended in green; the BSE Mid cap index rose 0.43%, while Small cap index was up by 0.32%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.45%, Industrials up by 1.10%, Bankex up by 1.05%, Financial Services up by 0.73% and Metal up by 0.67%, while Healthcare down by 0.89%, Realty down by 0.86%, Utilities down by 0.70%, Power down by 0.56% and Consumer Durables down by 0.15% were the top losing indices on BSE.

The top gainers on the Sensex were Axis Bank up by 2.71%, Indusind Bank up by 2.31%, Larsen & Toubro up by 2.06%, ICICI Bank up by 1.02% and Infosys up by 0.93%. On the flip side, Sun Pharma down by 3.57%, Power Grid Corporation down by 1.56%, TCS down by 0.90%, Kotak Mahindra Bank down by 0.72% and Wipro down by 0.68% were the top losers.

Meanwhile, taking a major step to boost exports, the commerce ministry has said the government has extended export benefits under the tax refund scheme -- Remission of Duties and Taxes on Exported Products (RoDTEP) -- to chemicals, pharmaceuticals and products of iron and steel for a specified period.  It said that this was a long standing demand of the industry, which has been accepted.

Benefits under the Remission of Duties and Taxes on Exported Products Scheme will be given to exports made during December 15 this year till September 30 next year. These sectors were left out in the earlier exercise which was conducted in August 2021.

The government in August last year announced the rates of tax refunds under the export promotion scheme RoDTEP for about 8,700 products, such as marine goods, yarn and dairy items. In the last fiscal, Rs 12,454 crore was there for refunds under the scheme. After the addition of these products, the expanded list will increase from the current 8,731 export items to 10,342 goods.

RoDTEP is based on the globally accepted principle that taxes and duties should not be exported, and taxes and levies borne on the exported products should be either exempted or remitted to exporters.

The CNX Nifty traded in a range of 18,625.00 and 18,536.95. There were 27 stocks advancing against 23 stocks declining on the index.

The top gainers on Nifty were Axis Bank up by 2.77%, Indusind Bank up by 2.43%, Eicher Motors up by 2.12%, Larsen & Toubro up by 1.93% and Hindalco up by 1.64%. On the flip side, Sun Pharma down by 3.76%, Divi's Lab down by 1.54%, Power Grid Corporation down by 1.49%, HDFC Life Insurance Company down by 0.95% and TCS down by 0.76% were the top losers.

European markets were trading in red, UK’s FTSE 100 decreased 11.35 points or 0.15% to 7,477.84, France’s CAC was down by 5.48 points or 0.08% to 6,655.11 and Germany’s DAX was down by 30.90 points or 0.22% to 14,230.29.

Asian markets settled mostly lower on Thursday as weakness in Wall Street overnight on US Fed’s interest rate hike woes, along with worries about a possible global recession have weighed on Asian equities. Meanwhile investors are awaiting US inflation data as well as the outcome of the US Fed and European Central Bank policy meetings next week for further clues on the direction of monetary policy. Chinese shares fell marginally, despite optimism over easing of China’s strict Covid curbs. Japanese shares declined after Japan's economy contracted less than earlier reported in the third quarter and the country's current account unexpectedly turned to deficit in October.