Benchmarks continue to trade higher in morning deals

Indian equity benchmarks continued to trade higher in morning deals, tracking the firm global cues and buying in select index heavyweights. Sentiments remained up-beat with Commerce and Industry Minister Piyush Goyal’s statement that negotiations for bilateral free trade agreements with several countries are ‘well on track’ and India is also looking at some multilateral pacts that are fair and equitable for all the member countries. Some optimism also came with Crisil Ratings’ report that capital goods companies are poised to see revenue growth at a healthy 16-18 per cent during current financial year ending March 2023 on account of improved order flows. Revenue growth in the next financial year starting April 2023 too is expected to be in double digits. Traders took a note of Reserve Bank of India (RBI) Governor Shaktikanta Das’ statement that taming inflation is the top priority for South Asian countries like India as an unchecked price rise may pose risk to growth and investment outlook.

On the global front, Asian markets are trading mostly in green as optimism grew on hints of less aggressive Fed rate hikes and signs of easing inflation. Further, the reopening of China’s border solidified the global economic outlook. Back home, agriculture industry stocks remained in focus as Trade Promotion Council of India (TPCI) said India's agri exports are growing at a healthy pace and there is a need to focus on the processed food sector as it holds huge potential to boost the country's outbound shipments. 

The BSE Sensex is currently trading at 60673.52, up by 773.15 points or 1.29% after trading in a range of 60109.94 and 60704.94. There were 29 stocks advancing against 1 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.99%, while Small cap index was up by 0.90%.

The top gaining sectoral indices on the BSE were IT up by 2.36%, TECK up by 2.24%, Metal up by 1.39%, Power up by 1.28% and Auto up by 1.15%, while Consumer Durables down by 0.66% was the lone losing index on BSE.

The top gainers on the Sensex were Tech Mahindra up by 3.07%, TCS up by 2.83%, Mahindra & Mahindra up by 2.77%, HCL Technologies up by 2.46% and Tata Motors up by 2.25%. On the flip side, Titan Company down by 1.79% was the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has said that the optional income tax regime with seven tax slabs was brought in by the government to ensure lower rates for those in the low income bracket. Sitharaman said in the old tax regime, every tax assesses can claim about 7-10 exemptions and the  income tax rates vary between 10, 20, and 30 per cent, depending on income threshold.

The minister said along with the old tax regime, the government has come up with a parallel system which has no exemptions, but with simpler and more favourable tax rates. She said ‘The reason why I had to bring in seven slabs was to make simpler and lower rates for those who are in the lower income (bracket).’ The government in Budget 2020-21 introduced the optional income tax regime, under which individuals and Hindu Undivided Families (HUFs) were to be taxed at lower rates if they did not avail specified exemptions and deductions like house rent allowance (HRA), interest on home loan and investments made under Section 80C.

Under this, total income up to Rs 2.5 lakh will be tax exempt. A 5 per cent tax is levied on total income between Rs 2.5 lakh and Rs 5 lakh, 10 per cent on Rs 5 lakh to Rs 7.5 lakh, 15 per cent on Rs 7.5 lakh to Rs 10 lakh, 20 per cent on Rs 10 lakh to Rs 12.5 lakh, 25 per cent on Rs 12.5 lakh to Rs 15 lakh, and 30 per cent on above Rs 15 lakh. Under the old tax system too, income up to Rs 2.5 lakh is exempt from personal income tax. Income between Rs 2.5 lakh and Rs 5 lakh attracts 5 per cent tax, while that between Rs 5 lakh and Rs 10 lakh is levied with 20 per cent tax. Income above Rs 10 lakh is taxed at 30 per cent.

The CNX Nifty is currently trading at 18084.10, up by 224.65 points or 1.26% after trading in a range of 17936.15 and 18096.70. There were 48 stocks advancing against 2 stocks declining on the index.

The top gainers on Nifty were Tech Mahindra up by 3.16%, TCS up by 2.85%, Mahindra & Mahindra up by 2.77%, HCL Tech. up by 2.44% and Wipro up by 2.25%. On the flip side, Titan Company down by 1.82% and HDFC Life Insurance down by 0.02% were the top losers.

Asian markets are trading mostly in green; Hang Seng increased 336.77 points or 1.6% to 21,328.41, Taiwan Weighted strengthened 319.59 points or 2.22% to 14,692.93, KOSPI rose 60.23 points or 2.63% to 2,350.20, Straits Times advanced 17.37 points or 0.53% to 3,294.09 and Shanghai Composite gained 16.69 points or 0.53% to 3,174.33.

On the flip side, Jakarta Composite lost 5.39 points or 0.08% to 6,679.17.