Key benchmark indices dropped in early trade as weakness in Asian stocks weighed on sentiment. At 9:25 IST, the barometer index, the S&P BSE Sensex was down 96.05 points or 0.34% at 27,885.66. The Nifty 50 index was currently down 23.50 points or 0.27% at 8,599.40. FMCG and realty stocks declined in early trade.
In overseas stock markets, Asian markets slipped after US stocks took their biggest loss in almost a month yesterday, 2 August 2016, underscoring simmering worries about global economic growth. Meanwhile, growth in China's services sector cooled in July, a private survey showed today, 3 August 2016. The Caixin/Markit services purchasing managers' index (PMI) fell to 51.7 in July on a seasonally adjusted basis, from an 11-month peak of 52.7 in June. US stocks fell yesterday, 2 August 2016 on the back of disappointing auto sales and a steep drop for retailers on forecasts of poor summer sales, after a similar drop on Asian and European markets.
Closer home, the market breadth indicating the overall health of the market was negative. On BSE, 858 shares fell and 566 shares rose. A total of 57 shares were unchanged. The BSE Mid-Cap index was currently down 0.39%. The decline in this index was higher than the Sensex's decline in percentage terms. The BSE Small-Cap index was currently down 0.21%. The decline in this index was lower than the Sensex's decline in percentage terms.
HCL Technologies rose 4.43% after consolidated net profit rose 5.94% to Rs 2055.20 crore on 5.96% rise in total income from operations to Rs 11336.32 crore in Q1 June 2016 over Q4 March 2016. The result was announced before market hours today, 3 August 2016.
HDFC (down 1.29%), ITC (down 1.02%) and TCS (down 0.96%) were the major losers from the Sensex pack.
DLF declined 0.35%. The company announced that credit ratings agency ICRA has upgraded its outlook on the company's non-convertible debentures (NCD) and bank facilities to stable from negative. The rating agency has also re-affirmed its long term rating of ICRA A assigned to the company's NCD programme and bank facilities. The announcement was made after market hours yesterday, 2 August 2016.
NHPC slipped 0.8%. The company announced that the Unit 4 of Teesta Low Dam Project-IV (160 MW) project has been successfully spun at its full RPM on 1 August 2016. The announcement hit the market at the fag end of trading session yesterday, 2 August 2016.
Meanwhile, investors are awaiting the progress on the Goods and Services Tax (GST) constitutional amendment bill in parliament. According to reports, the long-pending GST Bill is listed for consideration and passage in Rajya Sabha today, 3 August 2016 amidst strong indications that the most far-reaching taxation reform would be supported by Congress and all other major political parties. The government is keen to get the GST Bill approved during the Monsoon Session of Parliament ending on 12 August 2016.
The GST bill, which has been approved by the Lok Sabha, is pending in the Rajya Sabha because of opposition to the bill in its current form by the Congress party. A constitutional amendment bill requires at least 50% attendance and support of two-third of those present and voting in the house. For the GST bill to become a law, the bill also needs to be approved by half the state assemblies after its passage in the parliament. GST, touted as the single biggest indirect taxation reforms since independence, will simplify and harmonise the indirect tax regime in the country. The GST seeks to create a seamless national market in the country by replacing plethora of state taxes and central taxes by one tax.
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