Markets open in green; trade flat in early deals

Indian equity benchmarks made flat-to-positive start on Wednesday amid mixed cues from global markets. Domestic indices are struggling for direction in early deals and trading near neutral lines with marginal gains as buying in Capital Goods, Metal and Industrials counters aided sentiments. Traders continue to take support with Icra Ratings’ statement that India’s economic growth will accelerate to 8.5% in the April-June period of the current fiscal from the 6.1% growth rate witnessed in the preceding January-March quarter. The rating agency attributed the faster growth to a supportive base and also a recovery in the services sector. Adding more optimism, Prime Minister Narendra Modi said India will become the growth engine for the world in the coming years, and the ease of doing business in the country has improved through reforms undertaken by the government. Though, upside remained capped amid foreign fund outflows. Provisional data from the National Stock Exchange (NSE) showed that foreign institutional investors (FII) sold shares worth Rs 495.17 crore on August 22. 

On the global front, Asian markets are trading mostly higher with caution following the mixed cues from Wall Street overnight, as traders continued to remain largely cautious, awaiting US Fed Chair Jerome Powell's speech at the Jackson Hole Symposium due later this week for more clues about the economy and interest-rate outlook. The symposium will feature meetings by global central bank leaders. Back home, in stocks specific developments, Jio Financial hit lower circuit on the BSE for the third consecutive day post listing on exchanges. Brightcom Group tumbled on the BSE after market regulator Sebi barred CEO and CFO from holding any directorial posts until further notice. However, BEML jumped on bagging a government order worth about Rs 101 crore for supply of command post vehicles.

The BSE Sensex is currently trading at 65244.93, up by 24.90 points or 0.04% after trading in a range of 65170.64 and 65436.10. There were 17 stocks advancing against 14 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.55%, while Small cap index was up by 0.67%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.14%, Metal up by 1.10%, Industrials up by 1.02%, Realty up by 0.70% and Consumer Durables up by 0.61%, while Power down by 0.15%, FMCG down by 0.08%, Auto down by 0.04%, Utilities down by 0.01% were the few losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 1.63%, Tata Steel up by 1.02%, Axis Bank up by 0.87%, JSW Steel up by 0.76% and Infosys up by 0.38%. On the flip side, JIO Financial Services down by 5.00%, Sun Pharma down by 1.39%, Bharti Airtel down by 0.64%, ITC down by 0.41% and Kotak Mahindra Bank down by 0.37% were the top losers.

Meanwhile, Economic Advisory Council to the Prime Minister Chairman Bibek Debroy has said the government was losing revenue due to the goods and services tax (GST), which should be revenue neutral with a single rate. However, he said that GST has led to a lot of simplification.

He said ‘the ideal GST is one that has a single rate, and it was meant to be revenue neutral. According to calculations by the finance ministry when GST was first introduced, the average rate should be at least 17 per cent. But, the existing rate is 11.4 per cent. Because of GST, the government is losing revenue’.

Debroy said the public as well as members of the GST Council want the 28 per cent tax rate to come down, but ‘no one wants the 0 and 3 per cent tax rates to go up’. He said ‘That way, we will never have a simplified GST’. He noted a ‘lot of abuse’ of GST provisions was taking place.

The CNX Nifty is currently trading at 19407.25, up by 10.80 points or 0.06% after trading in a range of 19385.60 and 19450.20. There were 31 stocks advancing against 20 stocks declining on the index.

The top gainers on Nifty were Hindalco up by 2.39%, Larsen & Toubro up by 1.58%, Cipla up by 1.43%, LTIMindtree up by 1.17% and Tata Steel up by 0.98%. On the flip side, JIO Financial Services down by 4.99%, Sun Pharma down by 1.45%, Bharti Airtel down by 0.67%, Tata Consumer Products down by 0.64% and Adani Enterprises down by 0.63% were the top losers.

Asian markets are trading mostly in green; Taiwan Weighted added 96.3 points or 0.58% to 16,533.91, Hang Seng advanced 64.41 points or 0.36% to 17,855.42, Nikkei 225 surged 54.58 points or 0.17% to 31,911.29, Jakarta Composite gained 26.72 points or 0.38% to 6,943.17 and Straits Times rose 6.24 points or 0.2% to 3,166.12. On the other hand, Shanghai Composite weakened 17.23 points or 0.56% to 3,103.10 and KOSPI was down by 13.90 points or 0.56% to 2,501.84.