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Bourses soar to day’s high on sustained buying activities
Sep-20-2019

Local equity markets gained further strength to reach at their intra-day high levels in afternoon session, as Finance Minister Nirmala Sitharaman proposed to slash corporate tax for domestic companies & new domestic manufacturing companies. The current corporate tax rate is 30%, which has been brought down to 22%. For new manufacturing companies the existing tax rate is 25% which has been brought down to 15%. Sentiments on the street improved further with Reserve Bank governor Shaktikanta Das exuding confidence that second-quarter GDP numbers will be better than the previous one as the government has started spending again. Sharp recovery in the rupee value against dollar along with positive cues from other Asian markets too influenced investor sentiment. Investors paid no heed towards the report that the Organisation for Economic Co-operation and Development (OECD) appears to be the most pessimistic on India's economy among think tanks, as it cut the GDP growth forecast by 1.3 percentage points to 5.9 per cent for 2019-20. 

On the global front, Asian market were trading mostly in green, as economic stimulus around the world eased fears of economic deceleration. Back home, the BSE Sensex is currently trading at 38030.24, up by 1936.77 points or 5.37% after trading in a range of 36085.74 and 38048.93. There were 28 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 4.99%, while Small cap index was up by 3.05%.

The top gaining sectoral indices on the BSE were Auto up by 8.20%, Bankex up by 7.61%, Capital Goods up by 6.66%, Energy up by 5.74% and Consumer Durables was up by 5.64%, while there were no losing indices on BSE..

The top gainers on the Sensex were Indusind Bank up by 11.31%, Maruti Suzuki up by 10.17%, Bajaj Finance up by 8.76%, Tata Steel up by 8.61% and SBI was up by 8.58%. On the flip side, Tech Mahindra down by 0.17%, TCS down by 0.16% and Infosys was down by 0.02% were the top losers.

Meanwhile, the Road Transport and Highways Minister Nitin Gadkari has said that the Cabinet will soon decide on the proposed vehicle scrapping policy. He has cleared a cabinet note on the proposed policy and the finance ministry has also approved the same. He said the Cabinet note will now be circulated to ministries concerned and the Cabinet was likely to take a call on it soon. He said the proposed policy for discarding old vehicles once approved will be applicable on all vehicles including two and three-wheelers.

Earlier, the policy had gone for a fresh round of consultation with the stakeholders on the direction of the PMO. The minister had earlier said that once the policy is approved India could emerge as a hub for automobile manufacturing as key raw material available from scrapping like steel, aluminium and plastic are bound to be recycled, bringing down automobile prices by 20-30 percent. In May 2016, the government had floated a draft Voluntary Vehicle Fleet Modernisation Programme (V-VMP) that proposed to take 28 million decade-old vehicles off the road. A committee of secretaries (CoS) recommended to the ministry redesigning of the scheme for greater participation of states with partial support from the Centre. The CoS had suggested that the scheme may dovetail a calibrated and phased regulatory approach for capping the life of vehicles together with stricter implementation of emission norms and accordingly a revised consultation paper got in-principle nod at PMO.

In a bid to spur adoption of electrical vehicles, the government on July 26 this year had proposed amendments to Motor vehicle norms to allow scrapping of vehicles older than 15 years. In a draft notification, the government proposed renewal of fitness certificates for vehicles older than 15 years every six months instead of the current timeframe of one year. The notification also provided that the newly purchased motor vehicles will be exempted for the payment of fees for registration certificate and assignment of new registration mark, if the purchaser produces scrapping certificate of the previously owned vehicle of the same category issued by the authorised scrapping centre/agency.

The CNX Nifty is currently trading at 11265.65, up by 560.85 points or 5.24% after trading in a range of 10691.00 and 11272.80. There were 47 stocks advancing against 3 stocks declining on the index.

The top gainers on Nifty were Eicher Motors up by 13.56%, Indusind Bank up by 11.65%, Maruti Suzuki up by 9.42%, Bajaj Finance up by 9.20% and Ultratech Cement was up by 8.99%. On the flip side, Zee Entertainment down by 3.84%, TCS down by 0.20% and Tech Mahindra was down by 0.15% were the top losers.

Asian market were trading mostly in green; Taiwan Weighted strengthened 34.99 points or 0.32% to 10,929.69, Nikkei 225 surged 34.64 points or 0.16% to 22,079.09, KOSPI rose 11.17 points or 0.54% to 2,091.52, Shanghai Composite gained 3.13 points or 0.1% to 3,002.41 and Straits Times was up by 1.47 points or 0.05% to 3,160.27.

On the flip side, Hang Seng decreased 12.68 points or 0.05% to 26,456.27 and Jakarta Composite was down by 27.14 points or 0.43% to 6,217.33.

 
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