SENSEX 17052.78 -308.96
NIFTY 5184.25 -93.95
USD/INR 0051.20 +00.58
NASDAQ 3105.34 +37.42
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UPDATEDTIME 09.28 PM 26 MARCH 2012
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The National Stock Exchange's Nifty witnessed a sharp
sell-off on the first trading day of March series expiry-week and closed below
psychological 5200 levels on concerns that a new set of tax norms could affect
investments of foreign institutional investors through participatory notes.
The General Anti-Avoidance Rules comes into effect from next week. Under this, the income tax department will have the power to deny individuals and entities the benefits of any tax avoidance treaty that may presently exist.
"There were concerns on the taxability of the income of FIIs operating out of Mauritius and also of those operating through P-notes.
However, there is no clarity as yet, on the final implications of the new rules announced on the budget.
Traders were also worried that the Reserve Bank of India may not go ahead with interest rates cut next month due to sticky inflation and high international crude oil prices.
The market has scaled back its expectations of a rate cut both in terms of timing as well as in terms of magnitude. I do no expect immediate action either in terms of a rate cut or in terms of even a CRR cut in the forthcoming monetary policy.
Fall in Indian rupee against the US dollar is set to increase subsidy burden if the government fails to hike fuel prices. This will also impact the sentiments adversely, say dealers.
The Indian rupee fell to intraday low of 51.45 per dollar against previous close of 51.17 on demand for dollars from oil importers and a sharp fall in equities. The crude oil prices continued to hover around $125 per barrel amidst tension between Iran and Israel.
According to experts, factors like inflation, rupee and crude oil prices pose a risk for interest rate cuts.
Inflation is probably starting to become a bit worrisome because there were excise duty and service tax increases in the budget, which will add to inflation. We have increased our inflation view after the budget.
Second is the rupee, which has started to depreciate again, which again probably relates to increase in inflation.
Thirdly, if we see global oil prices, they have remained sticky at higher levels. They are not really coming off. So there are inflationary pressures which have not really abated.
The General Anti-Avoidance Rules comes into effect from next week. Under this, the income tax department will have the power to deny individuals and entities the benefits of any tax avoidance treaty that may presently exist.
"There were concerns on the taxability of the income of FIIs operating out of Mauritius and also of those operating through P-notes.
However, there is no clarity as yet, on the final implications of the new rules announced on the budget.
Traders were also worried that the Reserve Bank of India may not go ahead with interest rates cut next month due to sticky inflation and high international crude oil prices.
The market has scaled back its expectations of a rate cut both in terms of timing as well as in terms of magnitude. I do no expect immediate action either in terms of a rate cut or in terms of even a CRR cut in the forthcoming monetary policy.
Fall in Indian rupee against the US dollar is set to increase subsidy burden if the government fails to hike fuel prices. This will also impact the sentiments adversely, say dealers.
The Indian rupee fell to intraday low of 51.45 per dollar against previous close of 51.17 on demand for dollars from oil importers and a sharp fall in equities. The crude oil prices continued to hover around $125 per barrel amidst tension between Iran and Israel.
According to experts, factors like inflation, rupee and crude oil prices pose a risk for interest rate cuts.
Inflation is probably starting to become a bit worrisome because there were excise duty and service tax increases in the budget, which will add to inflation. We have increased our inflation view after the budget.
Second is the rupee, which has started to depreciate again, which again probably relates to increase in inflation.
Thirdly, if we see global oil prices, they have remained sticky at higher levels. They are not really coming off. So there are inflationary pressures which have not really abated.
RBI will
have to do that balancing between inflation concerns and growth concerns. We
still think that over the course of this year, we will see the RBI cutting
rates, which should be positive for the market.
The Nifty closed at 5184.25, down 93.95 points or 1.78 per cent. The broader index touched a high of 5274.95 and low of 5174.90 in trade today.
The Sensex ended at 17052.78, down 308.96 points or 1.78 per cent. It touched intraday high of 17377.59 and low of 17021.85.
I am looking to buy at lower levels of 5080-5150.I do not think it is a wise view that we will go back to 4700. In case there are no external events, chances are that this is a reaction and at some point it will be over.
BSE Midcap Index down 1.60 per cent and BSE Smallcap Index fell 1.40 per cent.
Amongst the sectoral indices, BSE Realty Index fell 3.58 per cent, BSE Power Index was down 2.56 per cent, BSE Bankex declined 2.44 per cent and BSE Metal Index slipped 2.19 per cent.
IDFC (-4.99%), Sesa Goa (-4.61%), Axis Bank (-4.52%), Tata Power (-4.37%) and Punjab National Bank (-4.36%) were amongst the top Nifty losers.
Jaiprakash Associates (2.83%), Kotak Bank (0.84%), ITC (0.20%) and Dr Reddy's Laboratories (0.07%) were the only gainers.
Market breadth was negative on the NSE with 221 gainers against 833 losers.
The Nifty closed at 5184.25, down 93.95 points or 1.78 per cent. The broader index touched a high of 5274.95 and low of 5174.90 in trade today.
The Sensex ended at 17052.78, down 308.96 points or 1.78 per cent. It touched intraday high of 17377.59 and low of 17021.85.
I am looking to buy at lower levels of 5080-5150.I do not think it is a wise view that we will go back to 4700. In case there are no external events, chances are that this is a reaction and at some point it will be over.
BSE Midcap Index down 1.60 per cent and BSE Smallcap Index fell 1.40 per cent.
Amongst the sectoral indices, BSE Realty Index fell 3.58 per cent, BSE Power Index was down 2.56 per cent, BSE Bankex declined 2.44 per cent and BSE Metal Index slipped 2.19 per cent.
IDFC (-4.99%), Sesa Goa (-4.61%), Axis Bank (-4.52%), Tata Power (-4.37%) and Punjab National Bank (-4.36%) were amongst the top Nifty losers.
Jaiprakash Associates (2.83%), Kotak Bank (0.84%), ITC (0.20%) and Dr Reddy's Laboratories (0.07%) were the only gainers.
Market breadth was negative on the NSE with 221 gainers against 833 losers.
Regards
RAKESH MAKIN
+91,
9041667797(DIRECT), 9915684997
OFF
0172-4657997
PANCHKULA (Haryana).
Email:makin_97@yahoo.com
Group mail id: makin97NSEtips@yahoogroups.co.in
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