Benchmarks continue to trade in green; Nifty above 5,850 mark

Indian equity markets pared minor gains but still continue to trade firm in the late afternoon session on account of buying in frontline blue chip counters. The sentiments on the street were on optimistic note despite overseas investors pulling out a record Rs 44,162 crore over $7.5 billion from the Indian capital markets this month which can be termed as their highest monthly outflow amid concerns over the depreciating rupee. Traders were seen piling positions in Realty, Capital Goods and Power stocks while selling was witnessed in IT and TECK sector stocks. In scrip specific development, Reliance Communications was trading firm after company made full repayment of two loans amounting to $1 billion i.e. around Rs 6,000 crore during the quarter ended June 30. United Spirits was trading in green after Morgan Stanley raised its stake in the company. Mahindra & Mahindra was trading under pressure after the company’s total sales in June declined 8% year-on-year to 38,092 units, a sign that demand for utility vehicles continues to slow in the domestic market.

On the global front, most of the Asian markets were trading in red while the European markets were too trading on pessimistic note. Back home, the NSE Nifty and BSE Sensex were trading above their psychological 5,850 and 19,500 levels respectively. The market breadth on BSE was positive in the ratio of 1421:738, while 136 scrips remain unchanged. 

The BSE Sensex is currently trading at 19549.69, up by 153.88 points or 0.79% after trading in a range of 19588.62 and 19347.57. 

The broader indices too added some ground; the BSE Mid cap and Small cap indexes were trading higher by 1.40% and 1.50% respectively.

The top gaining sectoral indices on the BSE were, Realty up by 4.07%, Capital Goods up by 2.28%, Power up by 2.26%, Metal up by 1.93%, and FMCG up by 1.59%, while IT down by 1.38% and TECK down by 0.28% on the BSE.

Out of the 30 stocks on the Sensex, 27 stocks were trading higher, while 3 were in red. The top gainers on the Sensex were Sterlite Industries up by 3.11%, Jindal Steel up by 3.08%, Tata Motors up by 2.74%, L&T up by 2.55% and SBI up 2.45%. On the flip side, TCS down by 1.89%, Infosys down by 1.33%, Mahindra & Mahindra was down by 0.47%, Sun Pharma was down by 0.35% and HDFC Bank was down by 0.22% were the top losers on the Sensex.

Meanwhile, the Confederation of Indian Industry (CII) has asked for a speedy action to implement the proposed Goods and Service Tax (GST), which is expected to bring many key benefits to the Indian economy, as well as to producers and consumers, by imparting efficiency to the indirect tax system. The industry body has said that the proposed tax law would help in increasing tax base, curbing evasion and raising compliance for both indirect and direct taxes. CII Chairman Adi Godrej has said that GST has the potential to add as much as 1.5-2.0 percentage points to GDP growth rate and such a measure is imperative for the country, given the current slowdown of the Indian economy. ‘GST is one of the most awaited reform measures on the table, and the industry hopes that political developments would not overshadow its progress’ he added.

The Empowered Committee of State Finance Ministers panel has met three times in recent months and there have been developments on issues like compensation to states for the Central Sales Tax, exemption list and the Dispute Settlement Authority.  However, in a recent political development Sushil Modi, who had chaired the Committee ceased to head the panel following his resignation as Deputy Chief Minister and Finance Minister of Bihar in the wake of the BJP-JD (U) split and now the panel is headless.

The GST amendment bill has been introduced in parliament and is being scrutinised by its Standing Committee on Finance. On the high combined central GST and state GST rates, the CII has suggested that the combined tax rates should not exceed 18 percent and that exemptions to the GST coverage should be minimal. 

The CNX Nifty is currently trading at 5,878.75 up by 36.55 points or 0.63% after trading in a range of 5,896.80 and 5,822.20.

Of the 50 stocks on the Nifty, 38 stocks were advancing, 11 were declining while 1 stock remained unchanged. The top gainers of the Nifty were JP Associates up by 4.10%, Sesa Goa up by 3.89%, Ranbaxy Laboratories up 3.49%, Reliance Infrastructure up by 3.47% and Jindal Steel up by 3.31%. On the flip side, TCS down by 1.93%, Infosys down by 1.49%, HCL Tech down by 1.26%, M&M down by 0.80% and Lupin down 0.78% were the major losers on the index.

Most of the Asian equity indices were trading in red; Jakarta Composite dropped 0.87%, Straits Times dipped 0.20%, KOSPI Composite contracted by 0.41%, and Taiwan Weighted was down by 0.33%.

On the flip side, Shanghai Composite added 0.81%, Nikkei 225 increased 1.28% and KLSE Composite was trading higher by 0.03%.

The European markets were trading in red; France’s CAC 40 was down 0.08%, Germany’s DAX lost 0.65% and the United Kingdom’s FTSE 100 edged lower by 0.27%.