Latest Stock Market News

Commodity currencies weaken, yen strengthens ahead of central bank meeting. European PMI data closely watched for rate cut expectations. Market reactions to Chinese demand, surprise rate cuts, and global economic indicators drive currency fluctuations. Traders prepare for potential shifts in major currency pairs.

The government has proposed a 60% increase in STT on equity derivatives, affecting trading costs for high-frequency traders. Sebi may implement stricter measures to regulate the market. Retail traders may not be significantly impacted by the changes.

GAIN DRAIN Tax on long-term capital gains raised from 10% to 12.5%, while short-term capital gains up from 15% to 20%

The new budget shifts share buyback taxes to investors, impacting promoters, large shareholders, and exit strategies, particularly in family settlements. Tax rates on accumulated funds often exceed 23%, according to Ketan Dalal. Prime Database noted 48 firms, including tech companies, spent ₹48,079 crore on buybacks in 2023. The buyback tax started in 2013 for unlisted, extended to listed in 2019.

The stock market initially dropped due to higher capital gains taxes but rebounded. Key corporate earnings rely on capex and consumption, bolstered by budget allowances and deductions. Retail participation and DII buying sustain high valuations.

Indian equity benchmarks saw minor declines: Nifty dropped 0.12%, Sensex 0.09%. Investor caution persisted over high valuations and new capital gains tax. Nikhil Ranka predicted consolidation between 23,700 and 24,500, while Chirag Mehta foresaw potential corrections. Mid-cap and small-cap stocks weakened; 2,223 BSE stocks fell. Quantum Mutual Fund noted capex disappointment and lack of demand-boosting measures.

The budget focuses on key areas like agriculture, employment, and infrastructure, with efforts to simplify taxation. Market valuations are high, calling for a cautious investment approach. Diversified asset allocation is recommended for balanced risk and return.

The recent budget emphasizes spending in the farm and rural economy, reduces income tax for middle-income households, and promotes employment and fiscal consolidation. Although higher capital gains tax and unchanged capex could disappoint, it includes social welfare schemes, a lower fiscal deficit, market borrowing, and beneficial impacts on bond yields, consumer durables, two-wheeler, QSR, pharmaceuticals, and telecommunications sectors.

Capital will go to places where it can thrive and multiply, so where business models are strong, where the enterprises are competitive, where value is getting created, I think capital will certainly flow there. So, I do not really think it is much of an issue.

​If you add 15,000 crores that has been given to Andhra plus another 26,000 crores that has been allocated to Bihar, which are also in turn for infrastructure projects. There is ultra mega power plant in AP. There are irrigation facilities to be set up in AP and there is allocation for roads for Bihar and therefore in many senses while it may seem that, oh, this is for two states, but if you add 15 and 26 that is another capex allocation that has happened.