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Benchmarks trade flat in early deals
Nov-21-2019

Indian equity benchmarks made mild positive start and are trading flat in early deals on Thursday. Gains in Capital Goods, Industrials and IT stocks were offset by losses in Telecom, Energy and Basic Materials stocks. Traders were worried with a private report stating that India’s economic growth probably hit a new low last quarter, with early forecasts showing expansion below 5%. Though, slew of measures announced by government in various sectors kept downside in check. The government has approved amendments proposed to the Toll Operate Transfer (TOT) model for national highways. The Centre approved the Code on Industrial Relations (IR) Bill, 2019 - considered to be the most contentious labour law amendments. Traders also took encouragement with the Reserve Bank of India’s (RBI) data showing that bank's credit grew by 8.07 percent to Rs 98.47 lakh crore in the fortnight ended November 6. Besides, markets regulator SEBI has decided to reduce the overall time taken for rights issue to 31 days from the current 55, a move aimed at making the process more efficient.

Global cues remained lackluster with all the Asian markets trading lower on renewed uncertainty about a trade deal amid rising tensions between the US and China over Hong Kong. The US House of Representatives on Wednesday passed a Senate bill supporting protesters in Hong Kong and President Donald Trump is now expected to sign the legislation passed by both chambers of Congress. Meanwhile, a report said that completion of a phase one US-China trade deal could slide into next year.

Back home, telecom stocks were in focus as the Union Cabinet has approved two years' moratorium on spectrum payment dues. PSU stocks were also in limelight as the government given the in-principle approval for disinvestment in select CPSEs. In scrip specific development, Syndicate Bank surged on getting Govt’s approval for proposed amalgamation.

The BSE Sensex is currently trading at 40657.54, up by 5.90 points or 0.01% after trading in a range of 40608.52 and 40744.85. There were 16 stocks advancing against 15 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index gained 0.14%, while Small cap index was up by 0.18%.

The top gaining sectoral indices on the BSE were Capital Goods up by 1.40%, Industrials up by 0.94%, IT up by 0.44%, Healthcare up by 0.40% and Consumer discretionary was up by 0.35%, while Telecom down by 2.19%, Energy down by 0.44%, Basic Materials down by 0.29%, Oil & Gas down by 0.26% a and PSU was down by 0.26% were the top losing indices on BSE.

The top gainers on the Sensex were Larsen & Toubro up by 2.36%, Indusind Bank up by 1.41%, HCL Technologies up by 1.06%, Tech Mahindra up by 0.80% and Hero MotoCorp up by 0.67%. On the flip side, Bharti Airtel down by 1.68%, Axis Bank down by 1.00%, Yes Bank down by 0.61%, Reliance Industries down by 0.58% and Power Grid Corporation down by 0.54% were the top losers.

Meanwhile, with an aim to boost the Indian economy, the Union Cabinet has approved a bill to replace an ordinance promulgated to reduce corporate tax to 22 per cent. Finance Minister Nirmala Sitharaman has said decision has been taken to bring the bill to replace the ordinance. The bill is likely to be introduced in Parliament during the ongoing Winter Session.

Earlier, Sitharaman had said the revenue foregone on reduction in corporate tax and other relief measures would be Rs 1.45 lakh crore annually. Following the decision, the corporate tax rate has come down to 22 per cent for domestic companies if they do not avail any incentive or concession. Also, companies opting for 22 per cent income tax slab would not have to pay minimum alternative tax (MAT). The tax rate has been reduced to 15 per cent for new domestic manufacturing companies incorporated after October 1.

The government had also announced not to levy enhanced surcharge introduced in the Budget on capital gains arising from sale of equity shares in a company liable for securities transaction tax (STT). Besides, the government had decided that listed companies which have announced buyback of shares prior to July 5 will not be charged with super-rich tax.

The CNX Nifty is currently trading at 11985.20, down by 13.90 points or 0.12% after trading in a range of 11978.25 and 12028.20. There were 21 stocks advancing against 28 stocks declining, while 1 stock remain unchanged on the index.

The top gainers on Nifty were Zee Entertainment up by 8.94%, Larsen & Toubro up by 2.33%, Indusind Bank up by 1.12%, HCL Technologies up by 0.98% and Hero MotoCorp up by 0.91%. On the flip side, Bharti Infratel down by 3.28%, BPCL down by 2.43%, Bharti Airtel down by 1.89%, GAIL India down by 1.12% and Britannia Industries down by 1.04% were the top losers.

All Asian markets were trading in red; Hang Seng decreased 433.38 points or 1.61% to 26,456.23, Nikkei 225 slipped 168.14 points or 0.73% to 22,980.43, Taiwan Weighted dropped 97.87 points or 0.84% to 11,533.33, Jakarta Composite lost 50.69 points or 0.82% to 6,104.42, KOSPI fell 27.34 points or 1.29% to 2,097.98, Straits Times trembled 26.40 points or 0.82% to 3,203.38 and Shanghai Composite was down by 11.49 points or 0.39% to 2,899.56.
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