Market extends initial gains

Key indices extended initial gains and hit fresh intraday high in morning trade. At 10:20 IST, the barometer index, the S&P BSE Sensex, was up 165.19 points or 0.47% at 35,425.48. The Nifty 50 index was up 37.60 points or 0.35% at 10,854.60. Firmness in most Asian stocks and GST council in its latest meet slashing the tax rate on 54 services and 29 items and also simplifying return filing process for businesses boosted sentiment.

The S&P BSE Mid-Cap index was up 0.43%, underperforming the Sensex. The S&P BSE Small-Cap index was up 0.7% outperforming the Sensex.

The market breadth, indicating the overall health of the market, was positive. On the BSE, 1,388 shares rose and 976 shares fell. A total of 82 shares were unchanged.

Telecom stocks declined. Reliance Communications (down 2.89%), Tata Teleservices (Maharashtra) (down 3.77%), MTNL (down 0.57%) and Idea Cellular (down 0.79%) declined.

Bharti Airtel fell 0.91% after consolidated net profit fell 16.50% to Rs 560.70 crore on 12.93% decline in net sales to Rs 20318.60 crore in Q3 December 2017 over Q3 December 2016. The result was announced after market hours yesterday, 18 January 2018.

Bharti Airtel's consolidated earnings before interest taxes depreciation and amortization (EBITDA) fell 11.5% to Rs 7587 crore in Q3 December 2017 over Q3 December 2016.

Shares of Bharti Infratel dropped 0.29%. Bharti Infratel is a provider of tower and related infrastructure and is a unit of Bharti Airtel.

Cement stocks were mixed. Shree Cement rose 0.42%. ACC (down 1.14%), Ambuja Cements (down 1.25%), and UltraTech Cement (down 1.62%) declined.

Grasim Industries advanced 0.2%. Grasim has exposure to the cement sector through its holding in UltraTech Cement.

Healthcare Global Enterprises jumped 6.08% after the Reserve Bank of India (RBI) yesterday, 18 January 2018, notified that the foreign investment limit for investment by Foreign Portfolios Investors (FPIs) in the company has increased from 24% to 100% of its paid up capital. HealthCare Global Enterprises has passed necessary resolutions of its board of directors and general body.

Further, owing to the above increase in the investment limit, it is notified that the aggregate shareholding by FPIs in HealthCare Global Enterprises has gone below the prescribed FPIs investment limit for the company. Hence, the restrictions placed on the purchase of shares of the above company by FPIs are withdrawn with immediate effect.

Meanwhile, the Union Finance Minister Arun Jaitley Chaired the 25th meeting of the GST Council in New Delhi yesterday, 18 January 2018. The Council has recommended certain changes in GST/IGST rate and clarifications in respect of GST rate on certain goods as per discussions in the 25thGST Council meeting. It slashed the tax rate on 54 services and 29 items, including old and used motor vehicles bio-diesel, while also simplifying return filing process for businesses. Certain policy changes have also been recommended by the GST Council.

Overseas, most Asian stocks gained although losses on Wall Street slowed the advance. Investors continue to watch the latest US budget battle on Capitol Hill, where uncertainly over a possible partial government shutdown this weekend continues. Legislation to avoid a US government shutdown at midnight on Friday advanced in Congress as the House of Representatives on Thursday night approved an extension of federal funds through 16 February, although the bill faced uncertain prospects in the Senate.

US stock benchmarks finished lower yesterday, 18 January 2018, pressured by worries over the possibility of a partial government shutdown, as investors sorted through a fresh batch of quarterly earnings results.

First-time weekly jobless claims fell to a 45-year low, dropping by 41,000 to 220,000. Meanwhile, construction of new houses fell 8.2% in December to a 1.19 million annual rate. Permits for future construction were basically flat at 1.30 million. Still, permits, housing starts and the number of new homes completed all hit the highest levels since 2007. A gauge of Philadelphia-area manufacturing fell to five-month low of 22.2 in January, the Philadelphia Fed said.

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