Index heavyweight ITC and stocks of oil exploration and production (E&P) companies led losses for key benchmark indices. The barometer index, the S&P BSE Sensex, lost 114.21 points or 0.45% at 25,523.90, as per the provisional closing data. The decline for the Sensex was higher in percentage terms than that for the 50-unit Nifty 50 index. The Nifty declined 14.85 points or 0.19% at 7,767.05, as per the provisional closing data. The Sensex and Nifty declined for the fourth straight trading session.
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%.
The market breadth indicating the overall health of the market was positive. On BSE, 1,428 shares rose and 1,338 shares declined. A total of 152 shares were unchanged. The BSE Mid-Cap index was provisionally down 0.14%. The decline in this index was lower than the Sensex's decline in percentage terms. The BSE Small-Cap index was provisionally up 0.14%, outperforming the Sensex.
The total turnover on BSE amounted to Rs 2653 crore, lower than turnover of Rs 2989.76 crore registered during the previous trading session.
Index heavyweight and cigarette major ITC declined 6.3% at Rs 314.45 after the committee headed by the Chief Economic Adviser Dr. Arvind Subramanian on possible tax rates under goods and services tax (GST) in its report recommended that the sin/demerit rate be fixed at about 40% (Centre plus states) and apply to luxury cars, aerated beverages, paan masala, and tobacco and tobacco products (for the states).
Shares of oil exploration and production (E&P) firms declined along with drop in global crude oil prices. Cairn India (down 2.8%), Oil India (down 1.79%), ONGC (down 1.49%) and Reliance Industries (down 1.2%) edged lower. Lower crude oil prices would result in lower realization from crude sales for oil exploration firms.
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In the global commodities markets, Brent for January settlement was currently off 38 cents at $42.62 a barrel. The contract had fallen 84 cents or 1.91% to settle at $43 a barrel during the previous trading session.
NMDC declined 1.47% at Rs 90.40 after the company reduced prices of lump ore by Rs 300 per tonne to Rs 1,800 per tonne with effect from 4 December 2015. In its monthly price review, the state-run iron ore miner has kept prices of iron ore fines unchanged at Rs 1,560 per tonne. The prices are excluding royalty, taxes, DMF, duties, levies etc. The announcement was made after market hours on Friday, 4 December 2015.
Maruti Suzuki India (MSIL) fell 0.87% at Rs 4,566 after the company reported 11.8% fall in its production to 1.03 lakh units in November 2015 over November 2014. The announcement was made after market hours on Friday, 4 December 2015.
Manali Petrochemicals tumbled 4.95% at Rs 31.65 after the company said that the production at both the plants of the company in Chennai remains affected since 2 December 2015 due to flooding and the resultant power disruptions. The plant operations are expected to recommence shortly in a phased manner subject to resumption of normalcy in power supply, material movements, etc, Manali Petrochemicals said during trading hours today, 7 December 2015. Consequently, the overall operations for the quarter and the year will be impacted significantly, it added.
In overseas stock markets, Asian and European stocks 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.
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