Markets remain subdued, Nifty below 8,900; RIL gains 2.5% on rejig

The broader market was trading flat with BSE Midcap gaining 0.06% and BSE Smallcap down 0.01%

Benchmark indices continued trading under pressure in the early morning trade tracking global cues after Asian markets opened lower following Wall Street. The Street will also watch out for US Fed Chair Janet Yellen’s speech later in the day which could give hints of possible Fed rate hike later this month.
 
The markets yesterday witnessed a trend reversal – from a 2-year high at open to a lower close on profit booking.
 
At 1:51 am, the S&P BSE Sensex was trading at 28,747, down 93 points, while the broader Nifty50 was ruling at 8,866, down 33 points.
 
The broader market was trading flat with BSE Midcap down 0.2% and BSE Smallcap up 0.02%.
 
"Nifty is witnessing a pause in the rally in the absence of follow up buying at the higher levels. Thus, indicating a sense of caution in the traders. Now if it fails to hold 8,850 levels a profit booking decline towards 8,800 then 8,740 levels may be seen while on the upside hurdle is at 8,950 then 9,000 levels," said Anand Rathi Technicals in a note.
 
On Thursday, foreign portfolio investors (FPIs) bought shares worth a net Rs 122.94 crore, while Domestic institutional investors (DIIs) sold shares worth a net Rs 83.21 crore, provisional data available with BSE showed.

Sectors and Stocks

RIL gained 2.5%% after the Mukesh Ambani-led promoter group, which owns a near-majority in Reliance Industries said that it plans to shrink the number of firms owning shares of India’s second-most valuable company through an internal sale to other holding companies. 

Eight promoter group companies of RIL will acquire around 119 crore shares, or 36.70 per cent, from 15 other promoter group firms in an inter se transfer for Rs 1.3 lakh crore, promoters of the company told the stock exchanges on Thursday.

Extending gains for the second straight session on good Feb auto sales numbers, Tata Motors gained over 1% in the early morning trade.

Infosys, ITC, Asian Paints were trading under pressure on BSE Sensex while Reliance Industries, Tata Motors, Bharti Airtel were the gainers.

Apollo Hospitals fell 4% in early morning trade on reports that a unit of Malaysian sovereign fund Khazanah has launched a block deal to sell $160 million worth of shares in the company. 

GST Changes: Enabling provision for peak 40% rate
 
The Goods and Services Tax (GST) Council is likely to get the power to raise the rate up to 40 per cent for any item in future, without the need for parliamentary approval.
 
The proposed move has not gone down well with tax experts, who want the rates to be moderate even in the future.
 
The Council, chaired by Finance Minister Arun Jaitley, has proposed an enabling provision in the GST Bills for a peak rate of 20 per cent each for Central GST (CGST) and state GST (SGST), from 14 per cent in the current draft , taking the limit to 40 per cent from 28 per cent.
 
However, the current slabs will not be disturbed, at least for now. The four-slab GST structure will remain unaltered at five, 12, 18 and 28 per cent, and a cess for the time being, as agreed by the Council. The government is targeting July 1 as the GST rollout date.
 
Global Markets
 
Asian stock markets were mostly lower, with MSCI's broadest index of Asia-Pacific shares outside Japan off 0.9% in the biggest daily drop so far this year.
 
Australia fell 0.8% and Shanghai 0.5%. Japan's Nikkei eased just 0.1% as a weaker yen helped limit the losses.
 
Asian peer Hang Seng was also trading lower by 0.50% in morning trade.
 
A chorus line of Fed officials singing of the need for higher rates has seen the implied probability of a move this month shoot to 74%, from just 30% at the start of the week.
 
Fed Chair Janet Yellen and Vice Chair Stanley Fischer are both due to speak later on Friday and are expected to stick to the same tune.
 
That was enough to make even Wall Street pause, and the Dow fell 0.53%, while the S&P 500 lost 0.59% and the Nasdaq 0.73%.