Indian equities pare losses; Nifty below 5,700 mark

Indian equity markets pared losses but continued its weak trade in the late afternoon session in absence of any positive upside triggers. The market received some support and buying emerged at lower levels after Moody’s Investors Service stated that, India’s 2013/14 Budget unveiled last week offered a realistic plan to meet the country’s fiscal deficit target, and should be a credit positive for its sovereign ratings. Moody’s added that the country’s fiscal consolidation plans could pave the way for monetary easing, thus helping revive economic growth. Traders were seen piling some position in Bankex sector while selling was witnessed in Realty, Metal and CG sector. In the scrip specific development, Bajaj Auto was trading in red after reporting 3.3% year-on-year (y-o-y) fall in total sales at 332,997 units in February 2013, a sharpest fall in past five months. Reliance Industries was trading in green after foreign brokerage firm Morgan Stanley upgraded the stock to overweight from underweight and raised its target price.

On the global front, all the Asian markets were trading in red barring Nikkei 225 while the European markets were too trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading below their psychological 5,700 and 18,900 levels respectively. The market breadth on BSE was negative in the ratio of 722:1895 while 98 scrips remain unchanged.

The BSE Sensex is currently trading at 18,830.74, down by 87.78 points or 0.46% after trading in a range of 18,930.86 and 18,760.41. There were 11 stocks advancing against 19 declines on the index.

The broader indices too extended its losses; the BSE Mid cap index and Small cap indices were trading down by 1.37% and 1.73% respectively.

The top gaining sectoral index on the BSE was, Bankex up by 0.05% while, Realty down by 2.67%, Metal down by 2.26%, Capital Goods (CG) down 2.08%, Consumer Durables (CD) down by 1.94% and Power down 1.11% were the top losers on the BSE.

The top gainers on the Sensex were Dr Reddy’s Lab up by 1.40%, HDFC Bank up by 0.51%, Reliance Industries up by 0.44%, SBI up by 0.37% and TCS up by 0.37%.

On the flip side, Jindal Steel down by 3.75%, Hindalco Industries down by 3.43%, Sterlite Industries down by 3.33%, L&T down by 2.65% and Bajaj Auto down by 2.52% were the top losers on the Sensex.

Meanwhile, beefing up efforts to reach the collection target for the fiscal, Finance Minister P Chidambaram said the revenue department has issued tax notices to 35,000 assesses on the basis of information it has and another 35,000 notices will be sent by next week. 

The government is expected to collect over Rs 5.65 lakh crore from tax revenues as per revised estimates, marginally lower than Rs 5.70 lakh crore budgeted for the current fiscal. The gross collection of direct taxes stood at over Rs 4.55 lakh crore during the April-January period of FY13.

By adding further Chidambaram said, the tax department has information about people's expenditure patterns and their financial transactions, thereby; today the best policy is to admit your income and pay tax. The government has earlier issued a strict warning to tax evaders and asked them to disclose their correct income and pay advance tax by the due date otherwise be prepared to face legal action. He added that the government can raise the tax-base to find more people to admit more income. 

The finance minister in Budget has proposed a 10 per cent surcharge on people or entities with taxable income of over Rs 1 crore. However, there are only 42,800 persons in this country that includes individuals, HUF, firms, associations of persons, admitting to a taxable income of Rs 1 crore and above.

Earlier, in February, Chidambaram had asked the revenue department to focus more on shifting to a technology-driven regime for tax collection instead of following a rough approach. To avoid litigation in tax collection, finance minister has asked the revenue department to adopt a non-adversarial approach for tax administration.

The CNX Nifty is currently trading at 5,682.30, down by 37.40 points or 0.65% after trading in a range of 5,712.00 and 5,663.60. There were 14 stocks advancing against 35 declines while 1 stock remains unchanged on the index.

The top gainers of the Nifty were Dr Reddy’s Lab up by 1.20%, Power Grid up by 0.74%, SBI up by 0.50%, BPCL up by 0.43% and TCS up by 0.39%.

On the flip side, Ambuja Cement down by 4.34%, ACC down by 3.99%, Reliance Infrastructure down by 3.96%, DLF down by 3.80% and Jindal Steel down by 3.72% were the major losers on the index.

Most of the Asian equity indices were trading in the red; Shanghai Composite tumbled 3.65%, Hang Seng crumbled 1.50%, Jakarta Composite declined 1.20%, KLSE Composite slipped 0.06%, Straits Times dropped 0.99%, KOSPI Composite contracted 0.66% and Taiwan Weighted was down by 1.22%. On the flip side, Nikkei 225 was up by 0.40%.

The European markets were trading in red; France’s CAC 40 dropped 0.35%, Germany’s DAX slipped 0.82% and United Kingdom’s FTSE 100 edged lower by 0.62%.