Weekly Wrap: Sensex, Nifty Cut Weekly Losses Ahead Of Tax Relief For Foreign Investors
The S&P BSE Sensex closed 1.74 percent lower this week at 36,701.16 and the NSE Nifty 50 declined 1.98 percent.
Indian equity benchmarks recovered some of their weekly losses in anticipation of a rollback of additional surcharge on foreign investors.
Finance Minister Nirmala Sitharaman withdrew the enhanced surcharge on equity capital gains after market hours on Friday. The surcharge was earlier introduced in the Budget last month.
The S&P BSE Sensex closed 1.74 percent lower this week at 36,701.16 and the NSE Nifty 50 declined 1.98 percent to close at 10,829.35.
“The finance minister has undone most of the damages caused by her maiden budget speech,” said Rajiv Singh, chief executive officer at Karvy Stock Broking. “Expect market to form base around the current level and inflows will be witnessed in broader markets among quality mid-cap and small-cap stocks.” A rally in favourite stocks of foreign institutional investors which constitute the benchmarks is expected, he said.
Agreed Ajay Bagga, a market expert, pointing out that markets will welcome the announcements made. “However, the journey is fraught with issues and a lot more needs to be done but this is a good first step,” he said in an interview to BloombergQuint.
On the technical front, Nifty is seen moving up to 10,900 levels on the upside while 10,600 is expected to be a crucial support level, according to Romesh Tiwari, head of research at CapitalAim.
If the Nifty stays above 10,800 levels on Monday, then it may move swiftly up to 10,900 levels with major resistance to come at 11,050 and that will make 10,600-10,650 as crucial support.Romesh Tiwari, Research Head, CapitalAim
Nine of the 11 sectoral gauges compiled by National Stock Exchange ended lower this week, dragged down by the NSE Nifty Realty Index’s 7.75 percent fall. The NSE Nifty IT Index was the top sectoral gainer, up 2.94 percent.
How Broader Markets Performed
The broader market index, represented by the NSE Nifty 500 Index, closed 2.21 percent lower during the week, dragged down by CG Power and Industrial Solutions Ltd., Reliance Capital Ltd. and Edelweiss Financial Services Ltd.
How Currency Markets Performed
The Indian rupee declined for the seventh straight week on Friday. The home currency depreciated 0.71 percent against the U.S. dollar to close at 71.66. It ended as the second-worst performing Asian currency this week.
Big Talking Points This Week
- How Charlie Munger thinks about the stock market.
- Seven of the world’s 10 worst-performing bank stocks are in India.
- Royal Enfield’s problem is bigger than the auto slowdown.
- Asia’s richest families: The 20 clans that control $450 billion.
- In charts: India’s auto slowdown and the forces behind it.
- Reserve Bank of India uses rare, 18th-century word to describe forecasts.
- Bonus: ISRO releases first moon image captured by Chandrayaan-2.
Key Events/Data To Watch Next Week
- Aug. 30: Q1 Gross Domestic Product and Fiscal Deficit data to be released.