Benchmarks trade lower in morning deals

Indian equity benchmarks erased initial gains and were trading lower in morning deals, due to losses in Realty, Telecom and Power stocks.  Traders took a note of the Reserve Bank Governor Shaktikanta Das’ statement that India should avoid adventurism and continue to focus on bringing down inflation towards the target of 4% despite the growing clamour to signal a pivot in monetary policy. He stated ‘At this point there is again clamour that one should change the stance. But we want clear evidence that inflation should moderate and perhaps a little faster. It will be too premature to talk in terms of changing the stance’. Traders overlooked the Central Board of Direct Taxes’ (CBDT) statement that net direct tax collection grew 21 per cent to Rs 4.62 lakh crore so far this fiscal on higher advance tax mop-up. The first instalment of advance tax, which was due on June 15, showed collection rose 27.34 per cent to Rs 1.48 lakh crore. This includes Corporation Income Tax (CIT) at Rs 1.14 lakh crore and Personal Income Tax (PIT) at Rs 34,470 crore. On the global front, Asian markets were trading mostly in green as softer-than-expected U.S. retail sales data reinforced bets of imminent Federal Reserve rate cuts.  

The BSE Sensex is currently trading at 77110.81, down by 190.33 points or 0.25% after trading in a range of 76954.87 and 77581.46. There were 6 stocks advancing against 24 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index fell 1.10%, while Small cap index was down by 0.94%.

The only gaining sectoral index on the BSE was Bankex up by 0.64%, while Realty down by 3.34%, Telecom down by 2.15%, Power down by 1.75%, Capital Goods down by 1.74% and Consumer Durables down by 1.73% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 1.63%, ICICI Bank up by 1.39%, HDFC Bank up by 1.04%, Kotak Mahindra Bank up by 0.62% and Axis Bank up by 0.40%. On the flip side, Titan Company down by 2.74%, Larsen & Toubro down by 1.67%, Bajaj Finance down by 1.48%, Power Grid Corporation down by 1.48% and NTPC down by 1.45% were the top losers.

Meanwhile, with a view to facilitate outbound shipments, the Directorate General of Foreign Trade (DGFT) under the Commerce Ministry has proposed to amend the export obligation period for certain sectors such as spices, pharmaceuticals and tea. The government has issued a call for comments from all relevant stakeholders on these proposed amendments, allowing a 15-day window for feedback. The plan aims to make the export process more flexible by updating the Advanced Authorisation Scheme.

This scheme permits duty-free imports of inputs required for manufacturing goods designated for export, subject to a specific export obligation period. Failing to meet this obligation within the stipulated timeframe leads to penalties. The DGFT has made this move in response to numerous representations from Export Promotion Councils (EPC) and exporters, advocating for a review of the current export obligations outlined in Appendix-4J of the Foreign Trade Policy's Handbook of Procedures 2023.

The proposed changes notably seek to ease export obligations for crucial commodities including wheat, raw sugar, natural rubber, maize, and walnuts. While export of wheat is currently banned in India, the willingness to adjust terms for other sectors suggests a broader strategy to bolster export activities. The directorate has detailed relaxation periods for various products, such as extending the period for spices to 12 months and reducing the export obligation period for coconut oil from 90 days to 6 months.

The CNX Nifty is currently trading at 23461.05, down by 96.85 points or 0.41% after trading in a range of 23412.90 and 23630.85. There were 6 stocks advancing against 44 stocks declining on the index.

The top gainers on Nifty were Indusind Bank up by 1.38%, ICICI Bank up by 1.26%, HDFC Bank up by 1.10%, Kotak Mahindra Bank up by 0.55% and Axis Bank up by 0.31%. On the flip side, Titan Company down by 2.80%, Adani Enterprises down by 2.24%, Coal India down by 2.17%, Shriram Finance down by 2.06% and BPCL down by 2.04% were the top losers.

Asian markets were trading mostly in green; Hang Seng advanced 348.96 points or 1.91% to 18,264.51, Jakarta Composite gained 32.18 points or 0.48% to 6,767.01, Straits Times rose 13.24 points or 0.4% to 3,315.02, KOSPI increased 23.05 points or 0.83% to 2,786.97 and Taiwan Weighted added 361.14 points or 1.59% to 23,118.57.

On the flip side, Shanghai Composite weakened 10.22 points or 0.34% to 3,020.03 and Nikkei 225 slipped 22.15 points or 0.06% to 38,459.96.