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Equity indices decline on weak global cues, LTCG tax worry

Last Friday, the equity indices fell the steepest since November 2016 as reintroduction of the long-term capital gains (LTCG) tax in the Budget led to a huge sell-off in the markets.

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Mumbai, Feb 5: With disappointment over the reintroduction of the long-term capital gains (LTCG) still looming over the Indian markets, the key equity indices on Monday slid into the negative territory for the fifth consecutive session following weak global cues and selling pressure.

According to market observers, announcements in the Budget like the LTCG tax and a higher-than-expected fiscal deficit target for 2018-19 continued to dampen investors’ risk-taking appetite.

The barometer 30-scrip Sensitive Index (Sensex) on the BSE closed below the 35,000-level at 34,757.16 points — down 309.59 points or 0.88 per cent from Friday’s close.

The BSE market breadth was bearish as 1,753 stocks declined as against 1,027 advances.

The wider Nifty50 of the National Stock Exchange receeded by 94.05 points or 0.87 per cent to close at 10,666.55 points.

“Markets corrected further on Monday, however, a slow bounce back from the lows helped to curb the losses. The weakness came on the back of a hit in investor sentiments after the Finance Minister had announced bringing the LTCG tax in Union Budget 2018 and projected a higher-than-expected fiscal deficit of 3.3 per cent for FY19,” Deepak Jasani, Head, Retail Research, HDFC Securities, told IANS.

“Weakness in global equity markets further added to the selling pressure in the Indian markets. Major Asian markets closed on a negative note, barring the Shanghai index, while the European indices like FTSE 100, DAX and CAC 40 traded in the red,” he said.

In the broader markets, the S&P BSE mid-cap index closed lower by 0.09 per cent, and the small-cap index by 0.37 per cent.

Contrary to the view of market analysts, the government said the downslide of the equity indices was not in reaction to the LTCG tax reimposition announcement but negative global cues.

“It is not due to the Budget or the LTCG. Dow Jones has also fallen by over two per cent,” Finance Minister Arun Jaitley told reporters on Monday.

On the currency front, the Indian rupee closed flat at 64.06 against the US dollar.

Provisional data with the exchanges showed that foreign institutional investors sold scrips worth Rs 1,263.57 crore, while domestic institutional investors purchased stocks worth Rs 1,163.64 crore.

Vinod Nair, Head of Research, Geojit Financial Services, said: “Selling continued in the market as concern over bond yield and weak global market impacted the sentiment.”

“Upcoming RBI monetary policy will be a key trigger for the market, the outcome of which is expected to be status quo, but any commentary over government’s fiscal policy and concern over rising yield will add volatility,” he added.

Sectorwise, the S&P BSE capital goods index declined by 528.85 points, followed by banking index by 333.43 points and finance index by 91.16 points.

On the other hand, the S&P BSE auto index edged higher by 184.46 points, telecom index by 23.85 points and FMCG index by 20.94 points.

Major Sensex gainers on Monday were: Bharti Airtel, up 4.20 per cent at Rs 439.50; Tata Motors, up 3.12 per cent at Rs 396.05; Tata Motors (DVR), up 2.27 per cent at Rs 218.80; Power Grid, up 2.08 per cent at Rs 196.50; and ITC, up 1.43 per cent at Rs 279.25.

Major Sensex losers were: HDFC, down 4.06 per cent at Rs 1,825.95; Larsen and Toubro, down 3.65 per cent at Rs 1,362.75; Kotak Bank, down 2.66 per cent at Rs 1,058.55; IndusInd Bank, down 2.36 per cent at Rs 1,714.25; and Bajaj Auto, down 2.12 per cent at Rs 3,174.

Business

Gold declines by Rs 95 on weak global trend

In the international market, gold was trading lower at USD 1,918 per ounce, while silver was quoting flat at USD 24.89 per ounce.

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Gold Wealth Price

New Delhi, Oct 22 : Gold prices fell Rs 95 to Rs 51,405 per 10 gram in the national capital on Thursday amid a weak global trend and rupee appreciation, according to HDFC Securities.

The precious metal had closed at Rs 51,500 per 10 gram in the previous trade.

Silver prices also declined Rs 504 to Rs 63,425 per kilogram from Rs 63,929 per kilogram in the previous trade.

“Spot gold prices for 24 carat in Delhi declined by Rs 95 on weak global prices and rupee appreciation,” HDFC Securities Senior Analyst (Commodities) Tapan Patel said.

The rupee appreciated by 4 paise to close at 73.54 against the US dollar on Thursday.

In the international market, gold was trading lower at USD 1,918 per ounce, while silver was quoting flat at USD 24.89 per ounce.

Navneet Damani, VP Commodities Research, Motilal Oswal Financial Services said, “Gold dipped after inching higher in the previous session amidst to and fro comments on the COVID-19 relief bill and some recovery witnessed in dollar.

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Business

Economy not circus lion that responds to ringmaster’s stick: Chidambaram

Chidambaram said the economy was largely determined by the market, by the laws of demand and supply, and by the purchasing power and the sentiments of the people, which are missing currently

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P Chidambaram

Former Finance Minister P. Chidambaram on Thursday criticised the Centre for its claims on reviving the economy. He said the economy was largely determined by the market, by the laws of demand and supply, and by the purchasing power and the sentiments of the people, which are missing currently.

“Unless the government puts money in the hands of the bottom half of the families and puts food on the plates of the poor, the economy will not revive smartly,” he added.

The Congress leader said if the government doubted about what he say, then “just listen to the voices of the voters of Bihar on their existential crisis — no work or not enough work, no income or little income, and their thoughts are on surviving, not on spending.

He also said that RBI Governor, SEBI Chairman and the DEA Secretary should tell the FM, in unison, that the vast majority of the people do not have the money or the inclination to buy goods and services.

“Is it not intriguing that the RBI Governor, the SEBI Chairman and the DEA Secretary should speak on the same day on the same subject? All three have tried to ‘talk up’ the economy. I wish the economy was a circus lion that would respond to the stick of the ringmaster!” Chidambaram mocked.

The former Finance Minister was criticising the statements made by the RBI Governor and the Economic Affairs Secretary.

Reserve Bank of India (RBI) Governor Shaktikanta Das said on Wednesday that India is at the doorstep of a revival process from the ongoing pandemic.

Speaking at an event, he said that it is very important that the financial entities have adequate capital to support the growth. He noted that many of them have already raised capital while others are planning to do the same.

He said that after the pandemic is contained, the government will have to spell out a fiscal roadmap for the country.

Secretary, Economic Affairs, Tarun Bajaj on Wednesday said the Centre is open for further measures to boost the economy.

Participating at a CII event, he said that the government has received suggestions from various ministries and sectors on the needed measures.

Bajaj also said that while preparing the next Union Budget, the government would be looking at expenditure for this year and the requirements of various ministries.

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Elon Musk’s Tesla launches ‘Full Self Driving’ beta to select drivers

The customers in Tesla’s Early Access Programme will receive software updates, which will give drivers access to Autopilot’s ‘partially’ automated driver assistance system on city streets.

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elon musk

San Francisco: Tesla CEO Elon Musk has revealed the company has started rolling out its next-gen Full Self Driving (FSD) set of features to a limited number of expert and careful drivers.

The customers in Tesla’s Early Access Programme will receive software updates, which will give drivers access to Autopilot’s ‘partially’ automated driver assistance system on city streets.

The Early Access program serves as a testing platform to help fix software bugs.

More Tesla owners would get the update as the time passes, with the goal of a “wide release” by the end of the year.

“Regarding the Full Self-Driving beta release, the Autopilot team, again, is just a really all-star team. I spent a lot of time with the Autopilot team. And there’s a lot of really talented people in that team who have worked incredibly hard to make the — to get the beta release out,” Musk said during the company’s Q3 earnings call on Wednesday.

Musk has been talking about ‘Full Self Driving’ a lot in the past couple of years, calling it an investment in the future that will become far more valuable once fully autonomous cars get regulatory approval.

Earlier, he explained that with feature-complete FSD, the car will be able to drive without human intervention but it would still be supervised.

Tesla also rolled out the 2019.40.2 version of its software to some electric vehicle owners and this update includes features like Adjacent Lane Speed Adjustments and Stop Sign Detection that are required for FSD.

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