Benchmarks add gains; trade continues in green

Indian equities added gains to continue firm trade above neutral line in the late afternoon session on account of buying in frontline blue chip counters. The sentiments were on positive note from the early trade after Reserve Bank of India (RBI) Governor Raghuram Rajan asserted that the central bank’s focus is to bring down inflation to boost investor confidence. Traders were seen piling positions in Consumer Durables, TECK and IT stocks, while selling was witnessed in Metal, PSU and Power sector. In scrip specific development, Gujarat Gas Company was trading firm after its board approved a proposed merger with other state-run companies involved in city gas distribution business. Mastek was trading in green after the shareholders approved buyback of up to 32 lakh shares. The market may remain volatile in the near future as traders may roll over positions in the Futures and Options (F&O) segment from the near-month i.e. February 2014 series to next month i.e. March 2014 series. The near month February 2014 F&O contracts will expire tomorrow i.e. February 26, 2014. The stock market will remain closed on Thursday i.e. February 27, 2014 on account of Mahashivratri.

On the global front, the Asian markets were trading mostly in green, while the European markets were trading on pessimistic note.  Back home, the NSE Nifty and BSE Sensex were trading above their psychological 6,150 and 20,800 levels respectively. The market breadth on BSE was negative in the ratio of 1127:1316 while 150 scrips remained unchanged.

The BSE Sensex is currently trading at 20824.65, up by 13.21 points or 0.06% after trading in a range of 20912.54 and 20777.73. There were 11 stocks advancing against 19 declines on the index.

The broader indices were trading on a mixed note; the BSE Mid cap index was up by 0.21%, while the Small cap index lost 0.01%.

The top gaining sectoral indices on the BSE were, Consumer Durables up by 2.82%, TECK up by 0.83%, IT up by 0.80%, HealthCare up by 0.21% and Auto was up by 0.20%. On the other hand the top losers included Metal down by 1.44%, PSU down by 0.63%, Power down by 0.55%, Realty down by 0.29% and Bankex down by 0.21%.

The top gainers on the Sensex were Bajaj Auto up by 2.12%, BHEL up by 2.05%, Bharti Airtel up by 1.89%, Wipro up by 1.78% and Cipla up by 1.55%. On the flip side, Coal India down by 2.12%, Gail India down by 2.08%, NTPC down by 1.92%, Tata Steel down by 1.68% and SSLT down by 1.52% were the top losers on the Sensex.

Meanwhile, in a bid to improve the country’s tax administration, the Tax Administration Reform Commission (TARC) Chairman Parthasarathi Shome has asserted that TARC’s proposed reforms will be mainly focused on expansion of tax and taxpayers’ base. Tax administration has to be cost effective and efficient and TARC’s recommendations will help to correct anomalies and approaches of a system that increases compliance. The TARC chairman further added that the commission has been studying the existing organisational structure and systemic processes to enhance tax administration’s capacity and skill base so that it can handle increasing tax base with greater efficiency, swiftness and lesser disputes.

The commission has planned to provide its recommendations through five reports and the first report will be submitted to the Government in May. Referring to TARC’s first report, Parthasarathi Shome asserted that first report would suggest various changes such as strengthening of workforce, capacity building, use of information technology, fixing of responsibility and accountability to bring down compliance cost and improve administration’s productivity. The TARC in its first report would also recommend measures for minimising disputes, simplified and timely disbursal of duty drawback, export incentives, improving services and taxpayers’ education programme.

The TARC Chairman further added that in next four more reports after the first, the commission would recommend steps to improve cross border information exchange and functional measures to enhance information sharing among the enforcement agencies. Furthermore, it would also provide analytical tools to prevent tax and economic offences.

The CNX Nifty is currently trading at 6,189.65, up by 3.55 points or 0.06% after trading in a range of 6,216.85 and 6,176.60. There were 20 stocks advancing against 30 decliners on the index.

The top gainers of the Nifty were Ambuja Cements up by 2.75%, Bajaj Auto up by 2.24%, Ranbaxy up by 2.16%, Bharti Airtel up by 2.09% and BHEL was up by 2.08%. On the flip side, NMDC down by 2.81%, GAIL down by 2.35%, Coal India down by 2.24%, JP Associates down by 2.15% and NTPC down by 1.84% were the top losers on the index.

Most of the Asian equity indices were trading in green; Nikkei 225 surged by 1.44%, Straits Times was up by 0.01%, KLSE Composite gained 0.08%, KOSPI Composite was up by 0.81% and Taiwan Weighted was up by 0.18%.

On the other hand, Shanghai Composite shed 2.04%, Jakarta Composite was down by 1.08% and Hang Seng dropped 0.32%.

The European markets were trading in red; France’s CAC 40 was down 0.50%, Germany’s DAX was down 0.38% and UK’s FTSE 100 dropped 0.47%.