Sensex reclaims 28,000; HDFC, Axis Bank up 1%

Markets continued to trade higher, amid firm global cues, led by financials while IT major TCS and index heavyweight Reliance Industries also witnessed renewed buying interest at lower levels in early trades.

At 9:35AM, the 30-share Sensex was up 119 points at 28,009 and the 50-share Nifty was up 48 points at 8,477.

On Wednesday, benchmark indices snapped five-day losing streak, amid a volatile trading session, aided by a sharp rebound in late trades led by financials Stock Market Trading Tips

Analysts at Nirmal Bang suggest since Nifty has managed to sustain and close above the resistance of 8400 levels is a positive signal. "The immediate support level for the index is now placed at 8340, as long as 8340 remains intact the upside target of 8500 to 8570 levels may be achieved," they said in a morning note.

Foreign institutional investors (FIIs) from countries with which India has double taxation avoidance agreements (DTAAs) that specifically exempt them from capital gains tax may escape minimum alternate tax (MAT) demands from the income tax department, a Business Standard report suggests.

Meanwhile, the India Meteorological Department said Southwest monsoon received by the country this year could be below normal, at 93% of the long-period average Financial Astrology Trading Tips

Global Markets

Asian stocks were trading firm in early trades with profit taking in Chinese shares after a private survey showed subdued manufacturing data in April. The flash HSBC/Markit Purchasing Managers' Index (PMI) declined to 49.2 in April. A reading below 50-point level indicates contraction. China's benchmark share index Shanghai Composite was down 0.9%. Among others in the region, Nikkei was up 0.3%, Straits Times rose 0.4% and Hnag Seng was up 0.5%.

US stocks ended higher with global card issuer such as Visa rising over 4% on plans to expand presence in China. Master Card also gained nearly 4%. McDonalds also witnessed buying on reports that its plans to revive sales. The Dow Jones ended up 89 points at 18,038.27, the broader S&P 500 rose 11 points at 2,107.96 and the tech-laden Nasdaq ended up 21 points at 5,035.17 Intraday Trading Tips

Sectors & Stocks

All sectoral indices on the BSE were in the green led by BSE Realty index along with Bankex, Healthcare, FMCG and Consumer Durables among others.

Mortgage lender HDFC was up 1% contributing the most to the Sensex gains along with private lenders such as HDFC Bank, ICICI Bank and Axis Bank.

Index heavyweight Reliance Industries was up 0.7% on renewed buying interest at lower levels after the recent correction.

Other gainers include, TCS, Maruti Suzuki and Hindustan Unilever, Tata Steel, Cipla and ITC among others.

Shares of Biocon were up 2% at Rs 465 extending its previous day’s 3% gain on the Bombay Stock Exchange (BSE) after the company said it has filed a prospectus with market regulator Securities and Exchange Board of India (Sebi) for the Initial Public Offer (IPO) of its research arm, Syngene.

In the broader market, the BSE Mid-cap index was up 1% and the Small-cap index was up 0.8%.

Market breadth was strong with 1,171 gainers and 317 losers on the BSE Nifty Trading Tips

FIIs with tax pact shield may be exempt from MAT

Foreign institutional investors (FIIs) from countries with which India has double taxation avoidance agreements (DTAAs) that specifically exempt them from capital gains tax may escape minimum alternate tax (MAT) demands from the income tax department.

"Wherever India has a double taxation avoidance agreement, they will get the treaty benefit. The treaty will be applicable," said Shaktikanta Das, revenue secretary, during a conference call with FIIs to address their concerns on MAT Stock Market Trading Tips

"If there is an FII which has made investments from a country with which India has a tax treaty, it can present the facts while giving its reply to the income tax officer. It can explain the point and the tax officer will certainly take it into consideration. The treaty benefit will be applicable in this case," Das said.

FIIs have been at loggerheads from 2007-08 with the tax department on the issue of MAT, and this has affected market sentiment Financial Astrology Trading Tips

ALSO READ: Working on FPI worries, says govt

India has DTAAs with 88 nations, of which 85 are in force. DTAAs with Mauritius, Singapore, Cyprus, France and the Netherlands exempt funds from capital gains tax in India, while those with the US, the UK and Luxembourg allow India to impose capital gains tax the way it wants to.

FIIs from countries with treaty benefits such as Singapore, Mauritius and the Netherlands have received tax notices making MAT demands.

"This clarification comes as good news for investors that treaty benefits override domestic laws," said Suresh Swamy, partner, PwC Intraday Trading Tips

"In view of our legal position that our treaties override our domestic law, we have been giving treaty benefits independently," said Anita Kapur chairperson of Central Board of Direct Taxes (CBDT).

The top four nations investing in India through the FII route - the US, Singapore, Mauritius and Luxembourg - have DTAAs with India. Till May 2014, according to the Securities and Exchange Board of India (Sebi), of the total FII flow of about Rs 17 lakh crore, that from the US stood at Rs 5.29 lakh crore, Mauritius Rs 3.98 lakh crore and Singapore Rs 2.02 lakh crore Commodity Trading Tips

"It is a well-established principle of tax laws that treaty provisions should override domestic tax provisions if they are more beneficial to the taxpayer. Thus, the relevant treaty provisions should be taken into account while determining the taxability of foreign investors. This will also avoid unnecessary litigation," said Vikas Vasal, partner, KPMG. Foreign brokerage firm CLSA reckons FII flows from the US accounted for 32 per cent of the overall amount till February 2015, Mauritius 22 per cent, Singapore nine per cent, Luxembourg nine per cent and the UK five per cent.

Despite the DTAA exemption, 46 per cent of the flows (from the US, the UK and Luxembourg) will face MAT demands.

FIIs are gearing up to approach dispute resolution panels and Commissioner of Income Tax (Appeals) against the tax demand. The income tax department has been citing an Authority for Advance Rulings, Delhi, judgment in the matter of Castleton Investments, which went against the tax assessee, as the reason behind the MAT notices Nifty Trading Tips

"The fact that Castleton came from Mauritius did not impact the ruling on the legal issue [of] whether MAT applies to foreign companies," Kapur said.

There have been three other rulings on MAT that went in favour of FIIs. In a case related to the Bank of Tokyo-Mitsubishi, a Delhi income tax tribunal ruled MAT was only applicable on domestic companies, not foreign ones. In another ruling related to Platinum Asset Management in 2012, the Mumbai income tax appellate tribunal ruled FIIs were not liable to pay MAT.

According to an analysis by Business Standard, after MAT was imposed, foreign investment in debt, equity and derivatives in India through participatory notes touched a seven-year high of Rs 2.72 lakh crore in March. Participatory notes are offshore derivative instruments used to invest in India by foreign investors not registered with the Sebi. According to current practice, those investing through participatory notes are not subjected to MAT Jackpot Trading Tips

Gold recovers on wedding season demand, global cues

Gold prices recovered by Rs 100 to trade at Rs 27,200 per 10 gm at the bullion market on the back of buying by jewellers, driven by wedding season amid a firm global trend.

Moreover, weakness in the rupee also influenced prices.

Silver also rebounded by Rs 160 to Rs 36,600 per kg on increased offtake by industrial units and coin makers Free Stock Share Tips

Traders said fresh buying by jewellers to meet wedding season demand and a firm global trend mainly attributed the recovery in gold prices.

Besides, weakness in the rupee that made imports costlier also influenced the precious metal prices.

Meanwhile, rupee was trading 25 paise lower at Rs 63.10 (intraday) at the forex market against the US dollar Personal Numerology Trading Tips

Gold in New York, which normally sets price trend in the domestic market, rose by 0.50 per cent to $1,201.80 an ounce and silver by 0.25 per cent to $15.98 an ounce in yesterday's trade.

In the national capital, gold of 99.9 and 99.5 per cent purity recovered by Rs 100 each to Rs 27,200 and Rs 27,050 per 10 gm, respectively. It had lost Rs 100 yesterday.

Sovereign, however, continued to be traded at last level of Rs 23,700 per piece of eight gram in limited deals Commodity Trading Tips

Tracking gold, silver ready rose by 160 to Rs 36,600 per kg and weekly-based delivery by Rs 60 to Rs 36,185 per kg.

On the other hand, silver coins remained steady at Rs 55,000 for buying and Rs 56,000 for selling of 100 pieces Nifty Trading Tips

Crude palm oil declines by 0.6% on profit-booking

Crude palm oil prices were lower by 0.57% to Rs 437.40 per 10 kg in futures trade today as speculators booked profits at prevailing levels, driven by sluggish demand in the spot market Stock Market Trading Tips

At the Multi Commodity Exchange, crude palm oil for delivery in April month fell by Rs 2.50 or 0.57% to Rs 437.40 per 10 kg in business turnover of 15 lots.
On similar lines, the oil for delivery in May contracts eased by Rs 2.10 or 0.48% to Rs 439.80 per 10 kg in 53 lots Financial Astrology Trading Tips

Analysts said besides profit-booking by speculators at existing levels, fall in demand in the spot market against adequate stocks position mainly weighed on crude palm oil prices at futures trade Intraday Trading Tips

Rajasthan farmer commits suicide at AAP's Kisan rally in New Delhi

A farmer from Rajasthan, who hanged himself from a  a tree at an AAP rally called to protest the land bill, has been declared dead by doctors at Delhi's Ram Manohar Lohia Hospital.

The farmer was dead on arrival, an RML doctor was quoted in media reports as saying Stock Market Trading Tips

The man was unconscious and barely breathing when Aam Aadmi Party activists took him down from a tree after some people saw him hanging from it by a white cloth.

The incident, witnessed by Chief Minister Arvind Kejriwalamong others, sparked chaos at the rally attended by thousands near Jantar Mantar in the heart of the capital Financial Astrology Trading Tips

Police rushed the man, identified as Gajender Singh from Dausa in Rajasthan, to a hospital even as hundreds of AAP supporters raised slogans against Delhi Police.

A suicide note in Hindi dropped by the man from the tree before he hung himself said he had nothing to look forward to in life as his entire crop had been destroyed by unseasonal rains.

He ended the note with "Jai Jawan, Jai Kisan, Jai Rajasthan Intraday Trading Tips

Nifty facing resistance above 8,400; HDFC, L&T up 1%

The Indian rupee was trading marginally higher at 62.83 per dollar against previous day's closing value of 62.85 a dollar tracking gains in equities.

STOCKS & SECTORS

BSE Healthcare index was the top gainer up 1% followed by Capital Goods, FMCG, Metal, Oil and Gas indices Stock Market Trading Tips

Shares of Sun Pharmaceutical Industries rebounded after to trade 1.5% higher after foreign investors bought shares of the drug maker via open market on Tuesday. Among its peers, Dr Reddy’s Lab and Cipla are trading higher by 0.4-1.1% each.

Hindustan Unilever witnessed renewed buying interest and was up nearly 3% after the stock corrected nearly 7% in the previous few sessions. ITC was trading flat.

Capital goods also witnessed renewed buying interest on recent commissioning of power projects and fresh order wins. L&T was up 1.1% while BHEL was up 0.5% Financial Astrology Trading Tips

M&M was trading higher by 2% on talk of the auto major raising its stake hike in Ssang Yong.

The financials were led by mortgage lender HDFC along with private bankers, Axis Bank and HDFC Bank.

However, IT stocks are heading for their sixth day of losses after Wipro's Q4 revenues declined by  1.2% to $1,775 million and disappointing muted dollar revenue guidance for the June quarter. Wipro was down 4%, Infosys eased 0.8% and TCS was trading marginally lower Intraday Trading Tips

Oil and Gas majors ONGC and GAIL have slipped in the red and are down up to 0.7% on further decline in the oil prices.

Among other shares, shares of Gitanjali Gems were up 8% after the company announced plans to rationalise the existing group structure and create synergy of operations Nifty Trading Tips

Larsen & Toubro gains on winning orders worth Rs 2,674 crore

Shares of Larsen & Toubro (L&T) has moved higher by nearly 3% to Rs 1,736 on the National Stock Exchange (NSE), after the company’s construction arm won orders worth Rs 2,674 crore across various business segments Stock Market Trading Tips

In the transportation infrastructure business, a major order has been received from a private infrastructure developer for the engineering, procurement and construction (EPC) of four-laning of the Hospet-Chitradurga road section inKarnataka under the National Highways Development Project (NHDP) Phase III, L&T said in a press release.

The power transmission and distribution business has bagged an EPC order from a reputed oil refinery company in Middle East for enhancement of their existing electrical facilities, it added Financial Astrology Trading Tips

The company said its solar business has received orders for the turnkey constructions of solar photovoltaic power plants from multiple private solar developers.

The stock opened at Rs 1,695 and touched a low of Rs 1,686 on the NSE in noon deal trade. A combined 1.56 million shares changed hands on the counter till 1444 hours on the NSE and BSE Intraday Trading Tips

Anil Ambani gives up LPG subsidy, urges 100,000 workers to follow

Heeding Prime Minister Narendra Modi's call, industrialistAnil Ambani has given up cooking gas subsidies and has urged about 100,000 employees of his group to follow suit.

Ambani joins a host of industry leaders, including Mukesh Ambani, Anand Mahindra, Anil Agarwal, Gautam Adani,Uday Kotak and Kishore Biyani, who have rallied behind Modi's call to well-to-do people to give up buying LPG at below market price so as to help cut subsidy bill Stock Market Trading Tips

"As a mark of solidarity to this noble initiative, the leadership team of Reliance Group has already opted out of LPG subsidy," Ambani's Reliance Group wrote to its employees yesterday evening.

It appealed to employees, who can afford to buy LPG at market price, to "voluntarily join this moment and contribute to the cause of nation building."

"We strongly believe that this is a great opportunity for all of us to make a humble contribution towards energy conservation, social equitability and improved utilisation of scarce natural resources," it wrote.

Modi had last month launched the 'Give-it-Up' campaign, nudging the well-to-do to give up LPG subsidies. Over 300,000 people, including ministers, government and public sector officials and MPs have given up using subsidised LPG Financial Astrology Trading Tips

While a subsidised cooking gas (LPG) cylinder costs Rs 417 per 14.2-kg cylinder in Delhi, a marketed priced bottle of the same size comes for Rs 621. Consumes are entitled to get 12 cylinders at the subdidised rate in a year.

In its letter to employees, the Group also detailed the procedure for giving up the use of subsidised LPG.

"Our Prime Minister Narendra Modi has undertaken several impactful steps to promote a more inclusive and equitable quality of life for all sections of the society. One such initiative is 'Give it Up', through which government is urging the economically well to do sections of the society to voluntarily give up use of subsidised LPG and buy at market price," it added Intraday Trading Tips

YES Bank Q4 net up 28% at Rs 551 crore

Private sector lender YES Bank posted a 28.1% rise in net profit for the quarter ended March 31, 2015. The bank had a Q4 net profit of Rs 551 crore compared to Rs 430.2 crore in same quarter previous fiscal.

The advances grew by 35.8% and stood at Rs 75,549.8 crore as on March 31, 2015. Deposits grew by 22.9% as on March 31, 2015 compared to previous year Stock Market Trading Tips

Rana Kapoor, MD & CEO, YES Bank said, "The bank has posted robust growth in advances and deposits while gradually increasing diversification and granularity as reflected in higher contribution from retail/SME advances and CASA deposits."

The Current Account Savings Account (CASA) deposits grew by 29%. This led to a CASA ratio of 23.1% as on March 31, 2015 compared to 22% in previous fiscal.

The bank's gross non-performing assets ratio stood at 0.41% in Q4 compared to 0.31% in same quarter previous year. However, sequentially it was down from 0.42% in Q3 of FY15 Financial Astrology Trading Tips

Net interest margin stood at 3.2% for Q4 compared to 3% in same quarter of FY14. Net interest income was up by 35.8% in Q4FY15 compared to Q4FY14.

The Bank has posted a net profit of Rs 2,005.4 crore for the year ended March 31, 2015 as compared to Rs 1,617.8 crore for the year ended March 31, 2014.

At 1345 hours on Wednesday, the lender's shares on BSE were trading 0.7% lower at Rs 779 apiece Intraday Trading Tips

Markets extend losses on monsoon worries, SBI down 4%

Benchmark indices have pared early gains are moving towards the sixth straight session of losses, amid a weak monsoon forecast, dragged primarily by the selling-pressure on banks, information technology and auto stocks.  
 
The first forecast of Monsoon rains, released today by Indian Meteorological Department (IMD), predicting a probability of 35% that the rainfall during the season may fall below normal has added to the worries over the possible build-up of an El Nino condition in South Asian region threatening severe to moderate disruption of rains Stock Market Trading Tips
 
In addition, government's combative stance on retrospective taxation and the reiteration of taxation dues worth Rs 40,000 crore on Foreign Institutional Investors has added to the nervousness over weak corporate earnings, delay in passing reform centric legislative proposals and erosion in rural demand.
 
At 2:09PM, the 30-share Sensex was down 190 points at 27,485 and the 50-share Nifty was down 66 points at 8,311.  
 
In the broader market, both the BSE Midcap index, down 0.9% and Smallcap index, down 1% have underperformed the front-liners. Market breadth in BSE is negative with 1,631 declines against 966 declines Free Stock Share Tips
 
Proceedings of the Parliament will be keenly watched as the government gears up to pass the Constitution Amendment Bill for the levy of Goods and Services Tax (GST) in the country which promises to integrate state economies and boost national growth. The bill was introduced in Lok Sabha in December.
 
Buzzing Stocks
 
All but one out of the 12 sectoral indices of BSE is in green. BSE IT index down 1.6% is the top loser followed by BSE Auto index and Bankex, down 1.5% each.
 
Shares of IT companies trading weak for the sixth straight session on discouraging earnings reports posted by most of the IT majors for the quarter ended March 2015 Intraday Trading Tips
 
Wipro, the largest loser from IT pack, has dipped nearly 5%, after the company said its IT Services revenue in dollar terms declined by 1.2% at $1.774.50 million for the quarter ended March 2015 (Q4FY16), on sequential basis. Wipro has appointed Rishad Premji, son of founder Azim Premji to the company's board.  Infosys and TCS have lost 1.6% and 0.2% each.
 
Sesa Sterlite has changed its name to Vedanta Limited post securing all the requisite approvals from shareholders and regulatory authorities. The stock is down 1.3%. Tata Steel and Hindalcohave lost 1.4% and 0.4% each Nifty Trading Tips
 
The government has confirmed the appointment of Dinesh K Sarraf as the chairman and managing director of India's biggest oil and gas producer, ONGC.  The stock is down nearly 3%. RIL is down 0.6% and GAIL is down 1%.
 
According to media reports, ITC, trading lower by 0.5%, is in talks with Century Textile and Industries Ltd to buy its paper division in a bid to diversify revenue to non-tobacco businesses.
 
The Reserve Bank of India has prohibited further FII purchases in the Kotak Mahindra Bank's shares, as aggregate foreign shareholding in the bank has reached the threshold limit after the acquisition of ING Vysya Bank. The stock is down 3.4% Financial Astrology Trading Tips
 
Recovering from the thrashing it witnessed yesterday, Sun Pharma is trading higher by 0.4% after foreign investors bought shares of the drug maker via open market on Tuesday.
 
M&M has opened its extended automobile manufacturing facility at Zaheerabad in Telangana on Wednesday. The stock is up 0.4% Intraday Trading Tips
 
Global Markets
 
Expectations of positive corporate earnings pushed Japanese shares to a 15-year high. Nikkei gained over 1%. Asian equities were mostly firmer on Wednesday with stimulus-fueled Chinese shares taking the lead. Shanghai Composite gained 2.4% and Hang Seng index gained 0.3%.
 
European markets have opened lower. FTSE 100 index is the top loser and is down 0.5% while CAC 40 and DAX indices have shed 0.2% and 0.1% each Jackpot Trading Tips

Govt could bring back sugar release order

The Centre might consider bringing back the release order (RO) mechanism for domestic sugar sales. It could also consider creation of a buffer stock of about three million tonnes, to help mills clear their sugarcane payment dues to farmers Stock Market Trading Tips

The dues, over Rs 19,000 crore as on March 31, might spiral further unless sugar prices stop falling. A consensus to this effect seems to have emerged after a meeting of key ministers on Tuesday. A final decision on the economic cost of the proposed measure is expected to be taken by the finance ministry, after possible consultation with the Prime Minister’s Office.

Under the RO mechanism, the central government decided how much sugar each mill in the country could sell in the open market. It was discontinued a few years earlier.

The meeting was attended by Food Minister Ram Vilas Paswan, Transport Minister Nitin Gadkari, Agriculture Minister Radha Mohan Singh, Commerce Minister Nirmala Sitharaman, Petroleum Minister Dharmendra Pradhan, Women and Child Development Minister Maneka Gandhi and Minister of State for Agriculture Sanjeev Balyan Financial Astrology Trading Tips

Officials said an executive order was also likely for raising the import duty on sugar from the existing 25 per cent to 40 per cent.

“A lot of issues were discussed during the two-day meeting between farmer leaders and representatives of  state governments on issues concerning the sugar sector. These were once again taken up today and we have zeroed in on a few of these,” a senior official said.

The sugar industry is finding a difficulty in paying the cane price (set by states) to farmers as mills have been incurring losses for the past few years, due to low realisation and high cost of production.

The Centre recently provided a subsidy of Rs 4,000 a tonne for export of 1.4 million tonnes (mt) of raw sugar, to improve the cash position of millers Intraday Trading Tips
The Indian Sugar Mills Association has been demanding that the government also create a buffer stock of at least two mt and restructure millers’ debt of Rs 36,000 crore. Ex-mill prices of sugar have fallen to Rs 21-24/kg in the country, while the cost of production is over Rs 30/kg.

Sugar production in India, the world’s second largest producer, is estimated to be higher than the domestic consumption for a fifth year in a row this season. The government has estimated output at 26.5 mt for the 2014-15 marketing year (October-September), as against 24.3 mt in 2013-14. Annual domestic demand is about 24.8 mt Commodity Trading Tips

Wipro slips 4% post results. Should you dump the stock?

Wipro lost 4.3% or Rs 25, in morning deals today to Rs 553 levels on the National Stock Exchange (NSE) after the company posted a net profit (standalone) of Rs 2,141.6 crore for the quarter ended March 2015 compared to Rs 2,353.1 crore for the quarter ended March 2014.

“Total Income during the recently concluded quarter increased from Rs 10,922 crore in the year ago quarter to Rs 11,230.3 crore for the quarter ended March 2015,” Azim Premji - led Wipro said in a statement Free Stock Share Tips

On a consolidated basis, the Group posted a net profit of Rs 2,272 crore in the March 2015 quarter, a growth of 2%. Total income increased from Rs 12,099.5 crore for the quarter ended March 2014 to Rs 12,719 crore in the March 2015 quarter.

After a sequential decrease of 1.2% IT Services revenue at $1,774.5 million during the recently concluded quarter, For Q1FY16, Wipro expects revenues from IT Services business to be in the range of $1,765 million to $1,793 million Financial Astrology Trading Tips

"Wipro Q4FY15 results were mixed?bag ? revenue missed, margin and guidance touch ahead of expectation. The management is confident of improving growth momentum in CY15 on the back of large deal wins. We expect marginal earnings upgrade by consensus despite weaker than expected IT services revenue, contrary to earnings cut for other peers that reported results so far," said Shashi Bhusan, an analyst tracking the company with Prabhudas Lilladher.

Besides Wipro, Hexaware, HCL Technologies, Tech Mahindra, Infosys, MphasiS and TCS also lost between 0.5% - 2.5% till 10:10am. CNX IT index was among the top loser among sectoral indices that slipped 1.1%. In comparison, the 50-share CNX Nifty was trading higher by 0.25% Intraday Trading Tips

Outlook

Given Wipro’s quarterly (Q4FY15) and full–year (FY15) performance, analysts suggest that the stock will continue to remain under pressure for some time as the telecom and energy verticals continue to hamper overall revenue growth.

“Wipro’s poor revenue performance in Q4FY15 and subdued Q1FY16 guidance will keep the stock subdued, despite apparently reasonable valuation. We would like to point out that valuation is a function of growth consistency, and Wipro’s inconsistent performances do not warrant a stock re-rating. We retain our ‘hold’ rating with a revised target price of Rs 611 (Rs 657 earlier) as we downgrade our target PE to 14x from 15x,” said Harit Shah, an analyst tracking the company with Karvy Commodity Trading Tips

Ashwin Mehta and Pinku Pappan of Nomura in a post results note suggest that Wipro remains their least preferred stock in Tier-1 IT, as they think its competitive positioning in developedmarkets is weaker versus peers.

"We prefer HCL Technologies, Cognizant Technology Solutions and TCS. We believe the stock is likely to react negatively to the weaker guidance, and expect consensus growth expectations to be cut," they said.

Bhusan, however, maintains an ‘accumulate’ rating on the stock with a price target of Rs 578 Jackpot Trading Tips

Jaitley to discuss GST roadmap with state finance ministers

Finance Minister Arun Jaitley will chair a meeting of the Empowered Committee of State Finance Ministers on Wednesday to chalk out a roadmap for the rolling out of the Goods and Services Tax (GST) from April 2016 Free Stock Share Tips

Earlier this month, at an RBI conference on financial inclusion, Jaitley had said the government would restore the credibility of decision-making, while easing processes and making India's tax structure non-adversarial.

He had also reiterated the NDA Government's promise to make India more business and investor-friendly.

He had further said that the proposed Goods and Services Tax (GST) would result in major changes in the system Financial Astrology Trading Tips

"Make some landmark changes, both in the indirect tax system and also in the direct tax system. Some of these ideas were outlining the budget presented recently. In the coming days, I am looking forward anxiously to one of the most important constitutional amendments with regard to the Goods and Services Tax (GST) being cleared by the Indian Parliament," he had said then Intraday Trading Tips

Rupee hits 3-1/2-month low as FIIs fret over tax concerns

The rupee fell to a three-and-a-half-month low in early trade on Tuesday as concerns over retrospective taxation loomed among foreign investors, while weak Asian peers and broad dollar strength added to the pressure Free Stock Share Tips

Stocks also fell to their lowest in nearly four weeks.

The partially convertible rupee fell to 63.1550 per dollar, its lowest since Jan 8 and compared to its previous close of 62.91/92 when it had fallen the steepest intraday since Dec 16.

The broader 50-share Nifty fell 0.38%, its lowest since March 30, and headed towards a fifth consecutive day of decline Financial Astrology Trading Tips

RBI's rupee management undermines hedging push

The Reserve Bank of India's intervention to temper the rupee's rise is inflating foreign exchange hedging costs, impeding its own efforts to bolster Corporate India's defences against potential currency turbulence.

For long, one of the biggest concerns for the RBI has been the risk of a destabilising outflow of funds as the USFederal Reserve edges closer towards raising interest rates from historic lows.

However, it is the rush of foreign money coming into Asia's third-biggest economy - about $14.3 billion has flowed into debt and equity markets this year - that is putting the central bank in a tight spot, forcing it to buy dollars in the spot market and sell them in the forward market Free Stock Share Tips

The effect of removing excess rupees from the system as the RBI sterilises the inflationary effect of money supply has further driven up rupee interest rates above dollar rates. This means banks and companies have to pay more rupees to hedge their dollar liabilities in the futures markets.

Ashish Vaidya, head of trading, asset liability management at DBS in Mumbai, said the RBI has to walk a fine line as it looks to ensure price stability while taking the upward pressure off the rupee from capital inflows Financial Astrology Trading Tips

"The RBI is buying dollars in the spot market and then paying forward to remove the surge of rupee liquidity, as it has to maintain price stability," he said.

Corporates must now pay upwards of 7.6% to buy dollars and sell rupees to meet future obligations. The six-month forward premium on the dollar versus the rupee has risen by around 35 basis points so far in 2015.

"The implication of higher forward dollar/rupee premium is importers are hedging less than they should, which is a risk to the banking system," said Anindya Das Gupta, managing director, head of trading at Barclays in India - precisely the kind of risk the RBI wants to minimise.

Underscoring the perils of inadequate hedging, the rupee fell 0.9% intraday on Monday - its steepest slide since Dec 16 Intraday Trading Tips

Last October, RBI Deputy Governor H R Khan warned the hedge ratio for overseas loans and foreign convertible debt had halved to around 15% in July-August from the previous fiscal year.

CAPITAL FLOWS

The rupee was the third best performing currency in Asia in the March quarter, rising 0.85% - backed by rising inflows on optimism over economic growth, stable inflation and structural reforms. It has retreated since then and is up around 0.2% so far in 2015.

The robust capital inflows have boosted importers' confidence that any rupee depreciation will be less costly than a hedge, while most exporters have also been lax about hedging on the view the currency will move in a tight band Nifty Trading Tips

"If we hedge, we will lose a lot of money," a senior official at a state-run oil company said, noting the short import payments period.

The stubbornly strong rupee has ramped up RBI's operations in the spot forex market - it bought a net $20 billion in January and February. The central bank has also been swapping rupees for dollars in the forward market, adding $260 million in up to one-year dollar contracts in February. In contrast, the RBI's net dollar holdings in tenors up to one-year fell sharply by $6.49 billion in December.

"We are not going to maintain any particular level for the rupee and so they (firms) have to recognize that they are taking on a big risk," Governor Raghuram Rajan said earlier this month, sounding a warning to firms that aren't hedging their currency exposure Jackpot Trading Tips

Rupee recovers from 3-month low; up 6 paise against dollar

The rupee recovered from more-than three months low of 63.15 in early trade on dollar selling by banks, believed to be on RBI instruction, to settle six paise higher at 62.85 against the US currency.

Forex dealers said "there were inflows from FIIs and FPIs to buy Japanse drug major Daiichi's nearly 9 per cent stake, estimated at Rs 20,420 crore, in Sun Pharmaceutical".

However, sluggish local equities amid sustained capital outflows and strong dollar overseas restricted the rupee rise to a major extent Free Stock Share Tips

At the Interbank Foreign Exchange market, the rupee resumed sharply weaker at 63.15 from previous closing of 62.91 and immediately touched low of 63.1550-level, not seen since January 8, when it had touched an intraday low of 63.20.

"At 63.10 we saw some nationalised banks (on behalf of RBI) in the market to smoothen volatility. There were also inflows in the market due which there was dollar selling in the market by foreign banks, which helped the rupee to recover," said a dealer with a private sector bank Personal Numerology Trading Tips

It later gradually recovered on dollar selling by some banks and exporters to a high of 62.74 before settling at 62.85, logging a small gain of six paise or 0.10 per cent. In last two days, it had plunged by 61 paise or 0.98 per cent.

The benchmark BSE Sensex today dipped by 210.17 points or 0.75 per cent today, while Foreign Portfolio Investors pulled out USD 227.52 million yesterday, taking a total to USD 485.68 million in last four sessions as per Sebi data Intraday Trading Tips

The dollar index was up by 0.33 per cent against a basket of six major global currencies.

In the New York market, the euro traded lower against the dollar yesterday after concerns that debt negotiations between Greek officials and the Mediterranean country's creditors have yielded little progress Nifty Trading Tips