Local bourses have puffed-up their gains on the back of selective buying by funds and retail investors at lower level despite indecisive global leads. As on the global front, US markets though managed close of modest green on Wednesday despite weak report of US service sector growth. But the Asian shares are trading mixed close with Shanghai and Hong Kong rising on hopes that China's latest interest rate hike will be its last for some time. The Chinese central bank increased its benchmark deposit and lending rates by 25 basis points in the latest salvo by leaders battling to bring inflation under control. Meanwhile, the US future indices are showcasing an uptick in the screen trade. Back home, strength of Index heavy weight - Reliance Industries - has also fuelled the uptrend of the market. Energy major rose after an oil ministry source said India's cabinet may consider approval for a $7.2 billion deal between the company and BP next week. However, the market men would be watching out for food and fuel Inflation data to be announced later in the noon. Moreover, on the broader markets, SKS Micro jumped 20%. The Finance Ministry's bill on the microfinance sector, that seeks to make Reserve Bank of India (RBI) a regulator for the sector, is seen as a positive for the stock. SKS Micro has been beaten down in the markets off lately after Andhra Pradesh introduced a new law to govern the sector in the state. However, on the losing side, Sun TV stocks have declined after the CBI said Dayanidhi Maran misused his post as the Telecom Minister in 2006.
Buying was witnessed across the board, however, leading the gainers were the stocks belonging from the Consumer Durable, FMCG and Realty stocks. Meanwhile, stocks from Bankex, IT and Auto are also the one's that are in green, but these stocks are witnessing the least traction. Both the rate sensitive counters are leading the chart from the behind on the expectation that RBI would be increasing its key interest rates a couple of times more to contain the spiraling inflation. The 30 share sensitive index- Sensex- soaring by 100 points is trading above the 18800 level, while the 50 scrip index -Nifty- too capturing gains of over 0.50% is trading well above its 5600 mark. The broader indices too are in jaunty mood and are outperforming their larger peers by trading well above 0.50% each. The overall market breadth on BSE was in the favour of advances which have thrashed declines in the ratio of 1448:683, while 97 shares remained unchanged.
The BSE Sensex is currently trading at 18,832.78, up by 105.81 points or 0.57%. The index has touched a high and low of 18,864.47 and 18,767.25. There were 26 stocks advancing against just 4 declines on the index.
The broader indices have prolonged their momentum; the BSE Mid cap and Small cap indices surged 0.68% and 0.84% respectively.
The top gaining sectoral indices on the BSE were, CD up by 1.05%, FMCG up by 1.02%, Realty up by 0.93%, Metal up by 0.86%, HC was up by 0.73%. While, there were no losers on the index.
The top gainers on the Sensex were Jindal Steel up by 2.31%, Bharti Airtel up by 2.07%, HUL up by 1.68%, NTPC up by 1.30%, HDFC was up by 1.10%.
On the flip side, Sterlite Industries was down by 1.08%, ICICI Bank was down by 0.79%, Bajaj Auto down by 0.32% and Wipro down by 0.07%.
Meanwhile, despite the fear of economic slowdown, the revenue collection of government has showed a robust growth in the first three months of current financial year. The net indirect tax receipts increased by 32% to Rs 76,499 crore, where as gross direct tax collection increased by 23% to Rs 1,03,000 crore in April-June period. However, net direct tax receipts fell by 17% to Rs 57,000 crore on account of about 200% increase in tax refunds.
The surge in revenue collection for the first quarter of current financial year is higher than the government's estimates for the whole fiscal year. The budget estimate for indirect tax collection for current fiscal year is Rs 392,908 crore increased by 15% from last financial year, and for the budget estimates for direct tax collections is Rs 532,651 crore, an increase of 19% from last fiscal. "The data, especially for indirect tax collections, was not showing signs of a slowdown in the economic activity. The government would be able to meet its tax mop-up target despite the duty cut on petroleum products", an Finance ministry officials said, and by adding further he said, "net direct tax collections could even better the target since a major chunk of the refunds for the year had already been given".
During the first three months of current fiscal, the tax refunds for the first quarter has been more than 200%, in the April-June period, revenue department has issued Rs 49,000 crore against the Rs 15,000 crore in the same period of last fiscal. However, on monthly basis, there has been moderation in payments of refunds to the tax payers. During April, revenue department has given tax refund of Rs 28,000 crore, which reduced to Rs 12,000 in May, and in June it further reduced to Rs 6,000 crore.
The indirect tax collections in the first quarter are 19% of the budget estimates in 2011-12, the indirect tax collections has been better than last year's first quarter in all the three segments i.e. customs, excises and service tax. However, because of lower tax refunds in the first quarter of 2010-11, net direct tax was higher than this fiscal.
The finance minister official said, the growth registered in the first quarter would offset the loss of Rs 24,000 crore, the government is expected to face on account of duty cut on petroleum products. Any further increase in crude prices would compensate for the loss due to reduction in excise duty on diesel.
In May, in order to reduce the impact of price hike on inflation and to provide relief to state owned oil marketing companies, government had removed 5% custom duty on crude oil, reduced the import duty on petrol and diesel from 7.5% to 2.5% and reduced the excise duty on diesel by Rs 2.6 to Rs 2 per liter. This reduction is custom and excise duties will cost around Rs 49,000 crore to the government.
The total indirect tax collections for 2010-11 stood at Rs 342,824 crore, exceeding the revised estimate of Rs 334,500 crore. It also achieved the revised direct tax collections target of Rs 446,000 crore. The government had registered over 40% and 18% growth in indirect and direct tax collections, respectively, in 2010-11 when economy grew at 8.5%.
The S&P CNX Nifty is currently trading at 5,653.90, higher by 28.45 points or 0.51%. The index has touched a high and low of 5,662.65 and 5,632.95 respectively. There were 43 stocks advancing against 7 declines on the index.
The top gainers of the Nifty were Jindal Steel up by 2.42%, Bharti Airtel up by 2.06%, IDFC up by 1.68%, HUL up by 1.62% and Dr Reddy's Laboratories up by 1.58%.
On the flip side, Sterlite Industries down by 1.19%, ICICI Bank down by 0.74%, Wipro down by 0.52%, Bajaj Auto down by 0.39% and Maruti Suzuki down by 0.20% were the major losers on the index.
Most of the Asian markets were trading in the green; Shanghai Composite gained 0.24%, Hang Seng added 0.66%, Jakarta Composite surged 0.72%, Straits Times rose 0.50% and Seoul Composite was up by 0.57%
On the flip side, KLSE Composite declined 0.03%, Nikkei 225 slid 0.07% and Taiwan Weighted descended 0.55%
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