Sensex, Nifty Log Best Single-Day Gains In A Decade After Corporate Tax Rate Cuts
Catch all the live updates on share prices, index moves, corporate announcements and more from Sensex and Nifty today.
KEY HIGHLIGHTS
Closing Bell: Sensex, Nifty Cheer Corporate Tax Cut Sop
Indian equity benchmarks clocked their biggest intraday gains in a decade as the government lowered corporate tax rate to spur growth and create jobs.
The S&P BSE Sensex surged 1,921.15 points to 38,014.62 and the NSE Nifty 50 jumped 569.40 points close at 11,274.20. The broader markets represented by the NSE Nifty 500 Index surged 5.29 percent. The move has created an investor wealth of around $96 billion.
The cut in tax rate announced by the Finance Minister Nirmala Sitharaman could lead to more foreign investors and industries to come in the Indian market, KR Choksey Investment Managers’ Managing Director Deven Choksey said.
Tax rates in India have now become more competitive enough to global peers. This could compel foreign investors to invest more in India.Deven Choksey, Managing Director, KR Choksey Investment Managers
The Nifty is expected to reach 12,000 by Diwali as ‘fear’ turns to ‘greed’, according to Sanjiv Bhasin, executive vice president, IIFL Securities.
The market breadth was firmly tilted in favour of buyers. About 1,330 stocks advanced and 489 shares declined on National Stock Exchange.
Ten out of 11 sectoral gauges compiled by NSE traded higher. The NSE Nifty Auto Index jumped 9.9 percent— its highest jump since May 2009. The NSE Nifty IT Index was the only sectoral loser, down 0.20 percent.
Large Trade Alert: Coal India
Around 1.1 crore shares traded hands in a large trade, according to Bloomberg data. The buyers and sellers were not known immediately.
The state-run miner rose nearly 4.6 percent to Rs 202.40 each. The stock traded at 7.1 times its estimated earnings per share for the coming year.
Unichem Labs Jumps After Getting FDA Approval
Shares of the specialty pharma company rose as much as 6.6 percent, the biggest intraday since May, to Rs 201 apiece.
The company received U.S. FDA approval for its Roha plant, according to an exchange filing. The inception happened between Sept. 16-20, the filing added. Also, no form 483 was issued for its Kholapur facility.
The stock fell 11 percent in the past 12 months compared with a 2.5 percent gain in the Nifty.
PM Modi Hails Tax Cut Move
Prime Minister Modi termed the move to lower corporate tax “historic” and will provide stimulus to his pet project Make In India initiative. The reform may also translate into creation of jobs, he tweeted.
Market Commentary: Changes To Affect Corporate Profitability In India, Basant Maheshwari Says
The changes announced today will affect corporate profitability in India, said Maheshwari, partner and co-founder at Basant Maheshwari Wealth Advisers LLP.
“Right now, we just heard about things that were going to affect sentiment. It’s a huge change and there would be companies benefiting up to 15 percent. But ultimately, the benefit would come to those companies that show earnings growth for the next few years.”
While the entire market is gaining right now, investors need to choose their stocks carefully, he warned.
You have to buy companies that are going to make profits for the next several years. If you buy junk right now, those companies won’t make profits and neither would the investors.Basant Maheshwari, Partner & Co-Founder, Basant Maheshwari Wealth Advisers LLP
