Indices add gains in early afternoon deals

Indian equity indices added gains in early afternoon session, with both Sensex and Nifty trading higher by over 0.30% each, aided by heavy buying at IT and TECK counters, despite mixed cues from other Asian markets. Sentiments were positive amid a private report stating that the government is finalising changes in various debt recovery laws to empower banks and other lenders to quickly resolve non-performing loans. The measures include enabling special Debt Recovery Tribunals (DRTs) to handle high-value cases and granting legal validity to e-notices sent by banks. Further, on a day of completion of ten years of successful implementation of the Pradhan Mantri Jan Dhan Yojana (PMJDY), Union Minister for Finance and Corporate Affairs Nirmala Sitharaman has said that ‘Universal and affordable access to formal banking services is essential for achieving financial inclusion and empowerment. It integrates the poor into the economic mainstream and plays a crucial role in the development of marginalised communities.’

On the global front, Asian markets were trading mixed, after Malaysia's producer price inflation slowed somewhat in July. The figures from the Department of Statistics showed that producer prices rose 1.3 percent year-on-year in July, following a 1.6 percent increase in June. Prices have been rising since February. Among sectors, the annual price growth in mining eased to 2.2 percent from 4.6 percent in June, while the price index for agriculture, forestry, and fishing grew at a stable rate of 3.4 percent.

The BSE Sensex is currently trading at 81964.86, up by 253.10 points or 0.31% after trading in a range of 81578.32 and 82004.35. There were 17 stocks advancing against 13 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose by 0.23%, while Small cap index was up by 0.25%.

The top gaining sectoral indices on the BSE were IT up by 1.79%, TECK up by 1.62%, Telecom up by 0.78%, Healthcare up by 0.56% and PSU up by 0.43%, while FMCG down by 0.28%, Realty down by 0.26%, Basic Materials down by 0.09% and Bankex down by 0.09% were the top losing indices on BSE.

The top gainers on the Sensex were Indusind Bank up by 2.69%, Infosys up by 2.27%, Bharti Airtel up by 1.32%, HCL Tech. up by 1.26% and Tech Mahindra up by 1.16%. On the flip side, Asian Paints down by 0.87%, Maruti Suzuki down by 0.77%, Axis Bank down by 0.69%, Nestle down by 0.54% and Bajaj Finserv down by 0.40% were the top losers.

Meanwhile, Finance Minister Nirmala Sitharaman has said that the Goods and Services Tax (GST) council is going to discuss rationalisation of tax rates at the 54th GST Council meeting on September 9, 2024 but a final decision on tweaking taxes and slabs will be taken in a subsequent meeting. She also said that compensation cess on luxury and sin goods are also going to be discussed and can come up in the September 9 meeting or later.

At the 53rd GST Council meeting, it was learnt that Karnataka had raised the issue of continuation of compensation cess levy, repayment of the loan amount and its way forward. A compensation cess was initially brought in for 5 years to make good the revenue shortfall of states following the implementation of the GST. The compensation cess expired in June 2022, but the amount collected through the levy is being used to repay the interest and principal of the Rs 2.69 lakh crore that the Centre borrowed during COVID-19.

The upcoming GST Council meeting will now have to take a call on the future of the current GST compensation cess with regard to its name and the modalities for its distribution among the states once the loans are repaid. To meet the resource gap of the states due to the short release of compensation, the Centre borrowed and released Rs 1.1 lakh crore in 2020-21 and Rs 1.59 lakh crore in 2021-22 as back-to-back loans to meet a part of the shortfall in cess collection.

The CNX Nifty is currently trading at 25101.55, up by 83.80 points or 0.33% after trading in a range of 24964.65 and 25114.05. There were 28 stocks advancing against 22 stocks declining on the index.

The top gainers on Nifty were LTIMindtree up by 7.02%, Wipro up by 3.57%, Indusind Bank up by 2.62%, Infosys up by 2.32% and Eicher Motors up by 2.06%. On the flip side, Hero MotoCorp down by 1.29%, Asian Paints down by 0.96%, Britannia down by 0.79%, Maruti Suzuki down by 0.74% and Axis Bank down by 0.73% were the top losers.

Asian markets were trading mixed; Jakarta Composite gained 41.34 points or 0.54% to 7,639.22, KOSPI increased 0.58 points or 0.02% to 2,689.83, Nikkei 225 surged 83.14 points or 0.22% to 38,371.76 and Taiwan Weighted added 185.66 points or 0.83% to 22,370.66, while Straits Times fell 12.14 points or 0.36% to 3,386.33, Hang Seng declined 151.16 points or 0.85% to 17,723.51 and Shanghai Composite weakened 9.51 points or 0.33% to 2,839.22.