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Indian Equity benchmarks continue to trade in red terrain in noon deals as investors booked profits at higher levels, mainly in Metal, Basic Materials and PSU stocks. Investors were taking caution approach as across the world will be eyeing the FOMC meet this week for clarity on the outlook for tapering as well as interest rate timelines. While the Fed's planned reduction of bond purchases has been in focus this year, their view on interest rates will likely be the fresh triggers to move markets world over. However, downside remain capped as with the markets remaining buoyant as Foreign Portfolio Investors (FPIs) remained net buyers in domestic markets so far in September by investing a net sum of Rs 17,822 crore. FPIs invested Rs 11,287 crore into equities and Rs 5,018 crore in the debt segment on a net basis between September 1 and 17.

On the global front; Asian markets were trading lower ahead of a week packed with global central bank meetings, with a torrid session for the world's most indebted property developer China Evergrande. Back home, hotel stocks were in focus on hopes of business revival following unlocking of the economy and pick-up in travel. The management’s commentary on strong revival from July onwards is encouraging and business will be back to pre-Covid level by Q4FY22, if there won’t be third wave of the pandemic.

The BSE Sensex is currently trading at 58861.88, down by 154.01 points or 0.26% after trading in a range of 58525.89 and 59202.56. There were 8 stocks advancing against 22 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index lost 0.55%, while Small cap index was down by 0.56%.

The top gaining sectoral indices on the BSE were FMCG up by 1.07%, TECK up by 0.23%, IT up by 0.17%, Energy up by 0.06% and Telecom was up by 0.02%, while Metal down by 4.60%, Basic Materials down by 2.45%, PSU down by 1.67%, Power down by 1.49% and Utilities was down by 1.26% were the top losing indices on BSE.

The top gainers on the Sensex were Bajaj Finserv up by 2.39%, Hindustan Unilever up by 2.38%, ITC up by 1.99%, HCL Tech up by 1.77% and Bajaj Finance was up by 1.12%. On the flip side, Tata Steel down by 6.40%, HDFC down by 2.08%, SBI down by 1.91%, Bajaj Auto down by 1.39% and Indusind Bank was down by 1.11% were the top losers.

Meanwhile, Apparel Export Promotion Council (AEPC) Chairman A Sakthivel has said that the decision of the goods and services tax (GST) Council to correct the inverted duty structure on textiles from January 1, 2022, would help reduce tax burden on manmade fiber (MMF) fabrics and garments. He said the decision will bring a huge relief to the industry.

Sakthivel said the inverted duty structure has been an issue with the apparel industry and that the council had made recommendations to the government for the elimination of this anomaly that has been resulting in input tax credit accumulation blocking crucial working capital for businesses. He also said inputs into the MMF fabric segment (fiber and yarn) attract a GST rate of 18 percent and 12 percent whereas the GST rate on the MMF fabric is 5 percent and that for the finished goods apparel is 5 percent and 12 percent.

AEPC Chairman further said it creates a tax structure where the rate on inputs is higher than that on the outputs and this increases the effective rate of taxation of MMF fabrics and garments and violates the principle of fiber neutrality. He also said that the GST Council's decision to extend the validity of GST exemption on the transport of goods by vessel and air from India to outside India till September 30, 2022, will partially help soften the impact of the current exorbitant freight costs.

The CNX Nifty is currently trading at 17516.95, down by 68.20 points or 0.39% after trading in a range of 17425.30 and 17622.75. There were 12 stocks advancing against 38 stocks declining on the index.

The top gainers on Nifty were Bajaj Finserv up by 2.42%, Hindustan Unilever up by 2.20%, ITC up by 2.14%, HCL Tech. up by 1.86% and Bajaj Finance was up by 1.14%. On the flip side, Tata Steel down by 6.38%, Hindalco down by 5.57%, JSW Steel down by 3.37%, Eicher Motors down by 3.23% and BPCL was down by 2.65% were the top losers.

Asian markets were trading lower; Hang Seng decreased 842.77 points or 3.38% to 24,077.99, Jakarta Composite lost 71.41 points or 1.16% to 6,061.84 and Straits Times was down by 15.50 points or 0.5% to 3,055.73.