Positive global, local cues buoy market; Sensex up 340 points

| Thursday, September 3, 2015 - 15:51
First Published |

Positive global, local cues buoy market; Sensex up 340 points

Mumbai: A rebound in global exchanges coupled with notification of the latest reform in the retrospective tax regime buoyed investor sentiments leading to a barometer index gaining 340 points during the mid-afternoon trade session on Thursday.
The barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) gained 339.73 points or 1.33 percent.
A similar trajectory was witnessed at the wider 50-scrip Nifty of the National Stock Exchange (NSE). The CNX Nifty was trading 111.55 points or 1.45 percent up at 7,828.55 points.
The S&P BSE Sensex, which opened at 25,614.69 points, was trading at 25,793.29 points (at 2.05 p.m.) -- higher by 339.73 points or 1.33 percent from the previous day's close at 25,453.56 points.
The Sensex touched a high of 25,825.79 points and a low of 25,555.77 points in the intra-day trade so far.
Analysts observed that the markets were buoyed after the government notified the new amendments to the income tax act based on the recommendations of the Justice A.P. Shah Committee report on the applicability of minimum alternate tax (MAT) on foreign investors.
The report had recommended that MAT not be imposed on foreign portfolio and institutional investors. The MAT issue on capital gains was expected to impact the margins of foreign funds.
"The positive bias coming out of the Finance Minister's statement accepting the MAT recommendations and the subsequent notifications of the same has led to buying in the markets," Anand James, co-head, technical research, Geojit BNP Paribas, told IANS. 
"Risk appetite has grown considering the fact that cyclical stocks like banking and finance gained... While rupee-hedged sectors like IT and pharma came in for some selling pressure."
The Central Board of Direct Taxes (CBDT) has notified the recommendations made by the Shah panel on the applicability of MAT pertaining to the capital gains made by foreign investors.
On the other hand, a rebound in Asian markets and rupee's relative strengthening has also supported the markets gains. 
"Indian markets are trading firms today led by positive Asian cues and a bounce bank in other global markets," Vaibhav Agrawal, vice president, research, Angel Broking told IANS.
"However, we expect markets to remain under pressure in the short-term with the weak macro data from China, concerns over US rate hike and monsoon worries."

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