Domestic indices trade lower in early deals

Indian equity benchmarks made negative start on Wednesday tracking losses in global markets with all the Asian markets trading lower after U.S. inflation data accelerated in January but came in line with estimates, probably dashing hopes that the US Fed might further ease the pace of its interest rate hikes. Now, domestic indices are trading down with cut of around 0.40% each in early deals with ITC, Hindustan Unilever and Sun Pharma leading the losers on the indices. Sentiments in the markets remained subdued with concerns over rising inflation domestically as well as globally and their impact on the interest rate hikes. Traders overlooked Central Board of Indirect Taxes and Customs (CBIC) Chairman -- Vivek Johri’s statement that Rs 1.5 lakh crore in goods and services tax (GST) collection has become the new normal and that the Board is confident that it will cross this figure in the coming year. Meanwhile, Rupee opened 12 paise lower against the US dollar amid steadiness in value of greenback against a basket of six peers.

The BSE Sensex is currently trading at 60780.75, down by 251.51 points or 0.41% after trading in a range of 60750.32 and 60990.05. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index was up by 0.13%, while Small cap index up by 0.16%.

The gaining sectoral indices on the BSE were Realty up by 0.81%, Auto up by 0.41%, Metal up by 0.33%, Telecom up by 0.01%, Consumer Disc up by 0.00% while, FMCG down by 1.02%, Power down by 0.92%, Utilities down by 0.89%, Capital Goods down by 0.69%, TECK down by 0.52% were the losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 1.11%, Tata Steel up by 0.59%, Maruti Suzuki up by 0.52%, Mahindra & Mahindra up by 0.31% and Tech Mahindra up by 0.30%. On the flip side, ITC down by 1.86%, Hindustan Unilever down by 1.38%, Sun Pharma down by 1.28%, Larsen & Toubro down by 1.06% and HDFC down by 0.98% were the top losers.

Meanwhile, expressing optimism over GST collection, Central Board of Indirect Taxes and Customs (CBIC) Chairman -- Vivek Johri has said that Rs 1.5 lakh crore in goods and services tax (GST) collection has become the new normal and that the Board is confident that it will cross this figure in the coming year. The gross GST revenue collected in January 2023 was Rs 1,55,922 crore. This was for the third time, in the current financial year, GST collection has crossed Rs 1.50-lakh-crore mark. The GST collection in January 2023 is the second highest next only to the collection reported in April 2022.

Johri said that the biggest reason for increased GST collection is that there has been a significant increase in I-T return filing and compliance. He said both the Centre and the state governments have worked together. The return filing percentage has increased a lot, and added ‘Along with that the economy has also picked up’. He said the economy has become robust and the effect of Covid is over. He added ‘There has also been some increase due to inflation’. He further said ‘We have definitely increased the National Calamity Contingent Duty (NCCD) on cigarettes, there has been an increase of about 16 per cent’. He noted that it has been increased because cigarettes are demerit goods, and its consumption has a bad effect on health.

CBIC chairman said there was no increase on tax on cigarettes for the last three years. In a way, he said the Board has done induction of duty. He added ‘From this, I believe that there will be no significant difference on smuggling because if we take the proposal of total tax, then this increase is not very much’. In the context of gold, Johri said it was believed that as the duty on gold increases, so does the smuggling. He added ‘But this is wrong because we found in our analysis that smuggling happened even in the years when the duty on gold was low’. The chairman said when gold duty was increased, smuggling was less.

The CNX Nifty is currently trading at 17861.40, down by 68.45 points or 0.38% after trading in a range of 17853.80 and 17905.80. There were 14 stocks advancing against 36 stocks declining on the index.

The top gainers on Nifty were Adani Enterprises up by 3.29%, Eicher Motors up by 2.87%, Reliance Industries up by 1.09%, HDFC Life Insurance up by 0.65% and Tata Steel up by 0.55%. On the flip side, ITC down by 1.67%, Hindustan Unilever down by 1.40%, Sun Pharma down by 1.29%, ONGC down by 1.15% and Larsen & Toubro down by 1.10% were the top losers.

All Asian markets are trading lower; Hang Seng declined 272.98 points or 1.29% to 20,840.78, Taiwan Weighted lost 223.55 points or 1.43% to 15,430.93, Nikkei 225 slipped 124.14 points or 0.45% to 27,478.63, Jakarta Composite plunged 59.14 points or 0.85% to 6,882.72, KOSPI dropped 34.00 points or 1.38% to 2,431.64, Straits Times fell 30.22 points or 0.91% to 3,287.98 and Shanghai Composite was down by 10.67 points or 0.33% to 3,282.61.