Bulls staged a smart come back on Monday with Sensex on Monday logging its biggest single-day gain of over 406 points in nearly three weeks after comforting statement of Finance Minister Arun Jaitley on need to have globally compatible tax rates to broad-base the economy. Even gold rebounded from an 11-month low, but the rupee weakened to breach the 68-mark against the dollar.
He had also sought to allay market fears that the Government has no intention to impose tax on long-term capital gains on stock earnings.
The rally helped the broader Nifty get past the psychological 8,000 level. Investors took comfort from Finance Minister Arun Jaitley’s statement, who underlined the need to have globally compatible tax rates to broad-base the economy.
Tuesday’s gain is the biggest single-day rise since December 8 when the 30-share barometer had jumped 457.41 points. The gauge had lost 233.60 points yesterday, hit by talk of higher taxation after Prime Minister’s remarks on securities. At the close, the NSE Nifty was up 124.60 points, or 1.58 per cent, at 8,032.85.
Value-buying in several recently battered stocks and covering-up of short positions ahead of December monthly expiry on Thursday provided further momentum, traders said.
European stocks were trading higher as key indices such as Frankfurt, Paris and london’s FTSE rose by up to 0.14 per cent.
Asian stocks ended mixed, with Japan’s Nikkei rising 0.03 per cent and Shanghai Composite Index shedding 0.19 per cent. Hong Kong was shut today for a public holiday.
On the other hand, the rupee snapped its two-day rising streak by depreciating 32 paise to breach the 68-mark at 68.06 against the dollar due to month-end demand from importers and the American currency strengthening against other currencies globally.
Gains were widespread, led by metal, pharmaceuticals, FMCG, consumer durables, oil and gas, auto PSU and IT stocks that were widely lapped up.
Buying also extended to the broader markets, with mid-cap and small-cap indices advancing.
Gold prices in Chennai went up by a whopping Rs 1,330 to Rs 28,040 per 10 grams, while in the national capital, it firmed up Rs 475 to Rs 28,025 per 10 grams on Tuesday, in tandem with a firm trend in the global market and revival of buying by local jewellers. Globally, in london, gold rose by 1.31 per cent to $1,143.10 .