Benchmark indices tumbled on Friday as the long-term capital gains tax on equities investments dampened sentiment, while bonds slid for a second consecutive session on worries the central bank would become more hawkish on inflation.
The weak sentiment came a day after the government unveiled its budget for the year starting in April that raised spending for rural sectors and healthcare, widening the fiscal deficit target to 3.3% of gross domestic product from the previous 3.0%. The government also unveiled a 10 percent tax on long-term capital gains in equity markets.
Investors worried that higher spending and the government’s move to raise minimum support prices for crops could lead to higher retail prices at a time when consumer price inflation has already hit a 17-month high of 5.21%, well above the Reserve Bank of India’s target of 4%.
BHEL, Bajaj Auto, Bajaj Finance and Tata Power lost the most on both indices, while TCS, Wipro, Tech Mahindra, and HCL Tech were the top gainers.
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Benchmark indices ended higher on Friday after global rating agency Moody’s Investors Service upgraded India’s sovereign rating to Baa2 from Baa3 and changed the outlook to stable from positive.
This development that will give a big boost to Modi government, reduce the cost overseas borrowing and improve investments in India. Rating company, while justifying the upgrade said that the reforms undertaken by the government will “improve the business climate, enhancing productivity, stimulating foreign and domestic investment, and ultimately fostering strong and sustainable growth.”
The S&P BSE Sensex ended at 33,342, up 236 points, while the broader Nifty50 settled at 10,283, up 69 points.
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Benchmark indices pared gains to end flat, losing over 1.5% in the week on foreign fund outflows amid worries that the government may widen its fiscal deficit target of 3.2% of gross domestic product for the year ending in March 2018 to boost an economy that grew at a slower pace than expected.
Broader markets outperformed benchmark indices with BSE Midcap and BSE smallcap indices gaining 0.8% and 1% respectively. Both indices ended over 1% for the week
Foreign investors net selling equities worth $1.1 billion during the month. They had sold worth $2 billion in shares in August.
Bajaj Auto, Adani Ports, GAIL and Eicher Motors gained the most on both indices, while HUL and Wipro were the top losers.
Realty firm Godrej Properties today said it has entered into a joint venture agreement with Royale Builders and Developers to develop a 13-acre group housing project in north Bengaluru.
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In a highly volatile session, the domestic equity market ended on a positive note with BSE Sensex just 40 points shy of its record high level and Nifty50 closing near its all-time high.
Sensex closed 124 points or 0.39 per cent higher at 32,020.89 while Nifty50 closed the day at 9,915.25, up 42 points or 0.42 per cent.
The 30-share pack had opened at 32,035.88 and touched an intraday high and low of 32,062.23 and 31,808.93, respectively, as index heavyweights WiproBSE 6.47 % (up 6.54 per cent) and Reliance (up 3.75 per cent) hogged the limelight.
BSE Midcap index gained 6 points or 0.04 per cent to 15,185.53 as shares of Adani Power, Bajaj Holdings and Bajaj Finserv surged up to 7 per cent.
On the other hand, BSE Small Cap index shed 7 points or 0.05 per cent to end the day at 15,992.63 as shares of Gujarat NRE Coke (down 6.55 per cent), Nucleus (down 6.07 per cent) and Dish Tv (down 5.85 per cent) capped gains.
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The benchmark indices on Friday extended losses to end lower as global markets dipped after the United States launched cruise missiles against an airbase in Syria, while back home expectations of no further rate cuts this year by Reserve Bank of India (RBI) also impacted the sentiment.
The S&P BSE Sensex ended at 29,706, down 221 points, while the broader Nifty50 settled at 9,198, down 64 points.
In the broader market, the S&P BSE Midcap and the S&P BSE Smallcap indices pared all intraday gains to end 0.3% and 0.5% lower.
The breadth, indicating the overall health of the market, turned negative. On the BSE, 1,620 shares declined and 1,293 shares rose. A total of 129 shares were unchanged.
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The market on Friday extended fall for the second straight session as investors booked profits after a sharp rally that lifted the benchmark indices to near two-year highs in the previous session.
The negative trade in Asian markets, which slipped on expectations of a US interest rate hike in March, also weighed on sentiment.
The S&P BSE Sensex settled the day at 28,832, down 7 points, while the broader Nifty50 ended at 8,897, down 2 points.
The broader market outperformed the frontline indices. BSE Midcap gained 0.3%, while BSE Smallcap added 0.4%
The market breadth, indicating the overall health of the market, was negative. On BSE, 1,450 shares fell and 1,372 shares rose. A total of 171 shares were unchanged.
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The benchmark indices on Friday ended flat as investors preferred to stay on the sidelines ahead of the Reserve Bank of India’s policy meeting next week. The S&P BSE Sensex settled the day at 28,240, up 14 points, while the Nifty50 quoted 8,740, up 7 points at close. In the broader market, BSE Smallcap index outperformed the frontline indices and BSE Midcap to gain 1%. BSE Midcap added 0.6%. The market breadth, indicating the overall health of the market, was strong. On BSE, 1,600 shares rose and 1,187 shares fell. A total of 159 shares were unchanged.
Shares of Bombay Stock Exchange (BSE) made a strong debut on Friday, with the scrip listing at Rs 1,085, a 35% premium over the issue price of Rs 806 on the National Stock Exchange (NSE). The stock hit a high of Rs 1,200, up 49% against its issue price within minutes of listing. The stock eventually settled the trade 33% higher at Rs 1,070 against its issue price.
