Local equity markets shift gears; bourses trade flat with the light shade of red

Shifting gears, local equity markets after capturing gains are currently trading flat slightly bending towards the "red zone" as the investor's lacking the conviction are booking profits on small uptake of the bourses.  Feeble global cues after Moody's downgrading Portugal's debt rating to junk, has mainly clouded the picture at Dalal Street. On the global front, US stocks ended a thinly traded session mostly flat as investors paused after last week's surge. Meanwhile, the Asian indices too are trading very choppy as weakness in the financial stocks is weighing on most regional markets. However, the US future indices are showing an uptick on the screen trade. Back home, the plunge of the stocks from Bankex, FMCG and Power counters are mainly denting the sentiment. On the contrary, the surge of the Consumer Durable, Realty and Metal counters are limiting the losses of the bourses. Subdued 30 scrip sensitive index-Sensex- is currently trading flat with negative bias, above the 18700 level, while the 50 share index too following similar trajectory is trading unchanged from its previous close. On the flip side, though the broader indices have pared some of its gains but are still holding up their "green territory". The overall market breadth on BSE is in the favour of advances which are currently outperforming declines in the ratio of 1340:937, while 103 shares remained unchanged.

The BSE Sensex is currently trading at 18,736.98, down by 7.58 points or 0.04%. The index has touched a high and low of 18,823.45 and 18,725.56 respectively. There were 13 stocks advancing against 17 declines on the index.

The broader indices have sustained their positive trajectory; the BSE Mid cap and Small cap indices were up by 0.15% and 0.32% respectively.

The top gaining sectoral indices on the BSE were, CD up by 0.99%, Realty up by 0.55%, Metal up by 0.54%, CG up by 0.32% and TECk was up by 0.25%. While, Bankex down by 0.53%, FMCG down by 0.33%, Power down by 0.15%, PSU down by 0.13% and Oil & Gas down by 0.12% were the top losers on the index.

The top gainers on the Sensex were Bharti Airtel up by 1.19%, DLF up by 1.06%, HDFC up by 0.82%, Jindal Steel up by 0.78% and L&T up by 0.58%.

On the flip side, Tata Power down by 1.11%, ICICI Bank down by 0.97%, Reliance Communication down by 0.85%, ONGC down by 0.78% and SBI was down by 0.76% were the only losers on the Sensex.

Meanwhile, the Indian government is expected to come out with a draft 'negative list' for service tax in coming two weeks, meaning, services which are not revealed in it would be taxed in the proposed Goods and Services Tax (GST) regime. Joint Secretary in the Ministry of Finance, V K Garg said, 'The draft paper (on negative list of services) is nearly ready and you should see this paper in two weeks'.

Presently, only limited number of services fall in the tax net, government had proposed to tax most of the services under the GST regime. In the new system, all the services which are not mentioned in the negative list would be taxed in GST.  A constitution amendment Bill is pending in parliament which seeks to pave the way for introduction of GST.

Finance Minister Pranab Mukherjee in the Budget 2011-12, had announced that a public debate on the service tax to help government to finalize the approach to GST would take place. The finance minister also said that many experts have argued that it will be desirable to tax services based on small negative list, so that many untapped sectors are bought into tax net. Such an approach will be conductive for a nationwide GST.

The government is planning to implement the GST from next financial year. Its implementation is viewed as important tax reform. However, it has been stuck for years because of disagreement between states and central government over the new structure of proposed GST. The proposed GST regime would include most of the indirect taxes, including Value Added Tax (VAT) on the state front, national and local service taxes, and services excise tax.   The S&P CNX Nifty is currently trading at 5,630.70, lower by 1.40 points or 0.02%. The index has touched a high and low of 5,655.40 and 5,620.35 respectively. There were 24 stocks advancing against 26 declines on the index.

The top gainers of the Nifty were Sesa Goa up by 2.20%, Cairn India up by 1.20%, BHarti Airtel up by 1.07%, HDFC up by 1.05% and Grasim Industries up by 0.98%.BPCL down by 1.59%, ICICI Bank down by 1.09%, Tata Power down by 1.04%, ONGC down by 0.87% and SBI was down by 0.81% were the major losers on the index.

Most of the Asian equity indices were trading in the green; KLSE Composite up by 0.23%, Nikkei 225 gained 0.44%, Straits Times rose 0.11%, Seoul Composite added 0.18% and Taiwan Weighted was trading higher by 0.39%.

On the flip side, Shanghai Composite declined 1.10%, Hang Seng descended 0.40% and Jakarta Composite was down by 0.11% 

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