Benchmarks trade lower amid foreign fund outflows, fears over new Covid variant

Indian equity benchmarks made negative start on Tuesday tracking weakness in Asian counterparts. Markets are trading lower with marginal cut of around 0.15% each in early deals amid foreign fund outflows. Provisional data from the NSE showed foreign institutional investors (FIIs) sold shares worth Rs 855.80 crore on January 1. Also, fears over new Covid variant dampened sentiments in the markets. India logged 197 new cases of the JN.1 variant on Monday, the highest from Kerala, while the total number of active Covid-19 infections rose to 4,394 with the detection of 636 fresh cases, according to the INSACOG (Indian SARS-CoV-2 Genomics Consortium) data. However, broader indices -- BSE Mid & small cap – are outperforming larger peers with gains of around 0.35% each. Some support came as data released by the Ministry of Finance showed that the gross GST collections in December 2023 were recorded at Rs 164,882 crore, 10.3% higher than Rs 149,507 crore in December 2022. 

Most of the Asian markets are trading lower with China stocks dipping at the open after official data over the weekend highlighted a deepening contraction in its manufacturing sector. Official data showed China’s manufacturing PMI contracted further in December 2023, in a sign that more policy support was likely needed to revive its economy. Meanwhile, Japan was assessing the damage from a powerful earthquake that struck its central region on New Year’s Day. Markets in the region are closed until January 4.

Back home, the Ministry of Finance said a record high of 8.18 crore Income Tax Returns (ITRs) were filed in assessment year (AY) 2023-24 as of December 31, 2023. On the sectoral front, stocks of Oil & gas, and aviation industry are in focus as India hiked the windfall tax on crude oil while reducing the tax on diesel and aviation turbine fuel. The government hiked the windfall tax on petroleum crude oil to Rs 2,300 ($27.63) a ton from Rs 1,300. A tax on diesel of Rs 0.5 per litre was eliminated, as was a Rs 1 per litre windfall tax on aviation fuel. In stock specific development, Alembic Pharma surged on receiving eight product approvals from the US FDA during Q3.

The BSE Sensex is currently trading at 72162.27, down by 109.67 points or 0.15% after trading in a range of 72069.18 and 72332.85. There were 13 stocks advancing against 17 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 0.34%, while Small cap index was up by 0.39%.

The top gaining sectoral indices on the BSE were Healthcare up by 1.53%, Energy up by 0.67%, Metal up by 0.49%, Oil & Gas up by 0.46% and Telecom up by 0.42%, while Auto down by 0.63%, Capital Goods down by 0.39%, IT down by 0.36%, Bankex down by 0.31% and TECK down by 0.26% were the top losing indices on BSE.

The top gainers on the Sensex were Sun Pharma up by 1.83%, Bajaj Finance up by 0.79%, Bajaj Finserv up by 0.64%, Bharti Airtel up by 0.61% and Power Grid up by 0.55%. On the flip side, Ultratech Cement down by 1.76%, Mahindra & Mahindra down by 1.56%, Asian Paints down by 0.81%, Kotak Mahindra Bank down by 0.73% and Infosys down by 0.69% were the top losers.

Meanwhile, the finance ministry has said that Goods and Services Tax (GST) collections jumped 10 per cent to about Rs 1.64 lakh crore in December 2023 compared to Rs 1.49 lakh crore in the same month a year ago. During the April-December 2023 period, gross GST collection witnessed a robust 12 per cent growth, reaching Rs 14.97 lakh crore, as against Rs 13.40 lakh crore collected in the same period of the previous year.

The average monthly gross GST collection of Rs 1.66 lakh crore in the first nine-month period this financial year represents a 12 per cent increase compared to the Rs 1.49 lakh crore average recorded in the corresponding period of FY23.

Out of the total Rs 1,64,882 crore GST collection, CGST is Rs 30,443 crore, SGST is Rs 37,935 crore, IGST is Rs 84,255 crore (including Rs 41,534 crore collected on import of goods) and cess is Rs 12,249 crore (including Rs 1,079 crore collected on import of goods). Notably, this marks the seventh month so far this year with collections exceeding Rs 1.60 lakh crore.

The government has settled Rs 40,057 crore to CGST and Rs 33,652 crore to SGST from IGST. The total revenue of Centre and the States in the month of December, 2023 after regular settlement is Rs 70,501 crore for CGST and Rs 71,587 crore for the SGST.

The CNX Nifty is currently trading at 21712.00, down by 29.90 points or 0.14% after trading in a range of 21699.00 and 21755.60. There were 19 stocks advancing against 31 stocks declining on the index.

The top gainers on Nifty were Divi's Lab up by 2.70%, Coal India up by 1.93%, Sun Pharma up by 1.68%, Dr. Reddy's Lab up by 1.61% and Cipla up by 1.56%. On the flip side, Ultratech Cement down by 2.08%, Eicher Motors down by 1.58%, Mahindra & Mahindra down by 1.54%, Hero MotoCorp down by 1.39% and Larsen & Toubro down by 1.00% were the top losers.

Asian markets are trading mostly in red; Hang Seng declined 249.22 points or 1.48% to 16,798.17, Taiwan Weighted lost 111.35 points or 0.62% to 17,819.46, Straits Times fell 7.62 points or 0.24% to 3,232.65, Shanghai Composite weakened 6.23 points or 0.21% to 2,968.70 and KOSPI was down by 0.59 points or 0.02% to 2,654.69, while Jakarta Composite was up by 2.36 points or 0.03% to 7,275.16.