Markets remain steady ahead of the inflation data

The domestic equity markets are trading firm ahead of the weekly food inflation data, though oil and gas and metal sectors are marginally in red other sectors are continuing their momentum with consumer durables and PSU stocks taking the lead. There is not much movement in either the broader or main indices despite being the December F&O expiry session. The traders seem to be eying the food price inflation figures before taking further step. An EGoM on food, headed by Finance Minister Pranab Mukherjee, met yesterday and took a slew of decisions to check prices of wheat, rice, pulses and sugar. Though, the Food and Agriculture Minister Sharad Pawar has said that prices of food items like onion, egg and milk did not figure in Tuesday's meeting of the empowered group of ministers (EGoM) on food.

The BSE Sensex was currently trading at 20,327.84, up by 71.81 points or 0.35% while it has touched a high and low of 20,364.93 and 20,274.12 respectively

The market breadth on the BSE was extremely robust; the gainers outperformed the losers in a ratio of 1309:868 while 100 shares were unchanged. In the broader space BSE Mid cap and BSE Small cap were both up by 0.33%.

The major gainers on the Sensex were Tata Motors up 1.23%, Tata Power up 1.20%, Wipro up 1.06%, Tata Steel up 0.97% and BHEL up by 0.85%.

The major loser on the Sensex were ONGC down 0.71%, Bharti Airtel down 0.44%, DLF down 0.40%, Sterlite down 0.40% and HDFC Bank down 0.30%.

As the year 2010 comes close to an end, lobbying has already begun for the next fiscal's budget to be announced in Feb 2011. The industry chamber Assocham on Wednesday called for abolition of Minimum Alternate Tax (MAT) and reduction in Corporate Tax to 25% from existing 30% so that industry was left with more funds for investment.

"It will be ideal if there is complete removal of MAT. It will give the leverage to the industry to go for big investment. As an incentive to the industry to go for big-ticket investment, we have also called for reduction in the Corporate Tax," Assocham Secretary General D S Rawat said after submitting a Pre-Budget memorandum to the Finance Ministry.

The Chamber President Dilip Mosi said that in 10 years the MAT has gone from 8.48% in 2000-01 to 19.93% which has defeated the purpose of original exemptions. The MAT was introduced to bring into the tax net the companies paying dividend and enjoying benefits of higher depreciation and other tax exemptions, which sometimes resulted in nil or very low taxable income. However, contends the industry body, such tax exemptions and benefits including depreciation rates have been reduced over the years. Consequently, continuance of MAT has become redundant and therefore needs to be changed. At present there is no clear directions in the Direct Taxes Code (DTC) either as to whether the MAT paid prior to the introduction of DTC would be allowed to set off against regular tax liability. The government should tweak the concept of MAT and clear the grey areas with regard to DTC in the FY12 budget.

The S&P CNX Nifty rose 19 points or 0.31% to 6,079.35 from its previous closing . The index touched a high and a low of 6087.40 and 6062.35, respectively.

The top gainers on the Nifty were Suzlon up 2.03%, HUL up 1.43%, Tata Motors up 1.17%, Maruti up 1.12% & Tata Power up 1.08%.

The top losers on the Nifty were BPCL down 1.88%, ONGC down 1.33%, Ranbaxy down 0.91%, SAIL down 0.86% and Sesa Goa down 0.84%.

The Asian markets were still showing mixed trend with Hang Seng trading at 22,938.88, down by 30.42 points or 0.13%, KLSE Composite was down by 1.68 points or 0.11% to 1,522.66 and Nikkei 225 was trading at 10,239.02 down by 105.52 points or 1.02%.

On the other hand Jakarta Composite was trading at 3,713.55, up by 14.33 points or 0.39%, Straits Times was trading at 3,214.11, up by 6.20 points or 0.19% and Taiwan Weighted was trading at 8,878.89, up by 12.54 points or 0.14%.

 

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