A divergent trend was witnessed between two key benchmark indices in mid-morning trade with the barometer index, the S&P BSE Sensex, trading with small losses and the 50-unit Nifty 50 index trading with minuscule gains. At 11:16 IST, the Sensex was off 32.85 points or 0.13% at 25,605.26. The Nifty was up 5.55 points or 0.02% at 7,783.10. The market breadth indicating the overall health of the market was strong. On BSE, 1,428 shares rose and 868 shares declined. A total of 111 shares were unchanged. The BSE Mid-Cap index was currently up 0.09%. The BSE Small-Cap index was currently up 0.47%. Both these indices outperformed the Sensex.
In overseas stock markets, Asian share markets edged higher after Wall Street welcomed an upbeat US jobs report that suggested the world's biggest economy was well placed to handle an expected first increase in interest rates in almost a decade. Strong job data and comments from European Central Bank President Mario Draghi that the bank can step up monetary stimulus if needed triggered a rally in US stocks on Friday, 4 December 2015.
Closer home, shares of state-run oil marketing companies (PSU OMCs) rose on decline in global crude oil prices. BPCL (up 1.27%), HPCL (up 2.49%) and Indian Oil Corporation (up 1.69%) gained. Decline in crude oil prices could reduce under-recoveries of PSU OMCs on domestic sale of LPG and kerosene at government controlled prices. The government has already decontrolled pricing of petrol and diesel.
Shares of oil exploration and production (E&P) firms declined along with drop in global crude oil prices. Cairn India (down 2.44%), Oil India (down 2.43%), ONGC (down 1.41%) and Reliance Industries (down 0.95%) edged lower. Lower crude oil prices would result in lower realization from crude sales for oil exploration firms.
In the global commodities markets, Brent for January settlement was currently off 31 cents at $42.69 a barrel. The contract had fallen 84 cents or 1.91% to settle at $43 a barrel during the previous trading session.
Godrej Properties rose 2.23% at Rs 341.95 after the company announced that it has sold 300 apartments within one week at The Trees, its flagship project in Vikhroli, Mumbai. This represents more than 80% of the 374 apartments it opened for sale in the first phase of this project. The value of apartments sold is in excess of Rs 700 crore, making this Godrej Properties' most successful ever launch in terms of value of real estate sold.
Lanco Infratech rose 4.86% at Rs 6.47 after the company announced that its step down subsidiary Lanco Amarkantak Power (LAPL) has commenced power supply to Haryana discoms from a coal based 300 megawatts (MW) power generation unit in Chhattisgarh. The commencement of power supply to Haryana discoms will double the revenue of Lanco Amarkantak to around Rs 1200 crore and increase EBITDA by around Rs 200 crore for full year of operations.
Meanwhile, a committee headed by Chief Economic Adviser Dr. Arvind Subramanian on Possible Tax rates under goods and services tax (GST) has suggested revenue neutral rate in range between 15% and 15.5% (Centre and states combined) with a preference for the lower end of that range. The committee has recommended a two-rate structure for GST. In order to ensure that the standard rate is kept close to the revenue neutral rate (RNR), the maximum possible tax base should be taxed at the standard rate, the committee has suggested in its report submitted to the government. The committee has recommended that lower rates should be kept around 12% (Centre plus states) with standard rates varying between 17% and 18%.
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