Nifty hits 7-month low, Sensex tanks 234 points
|Source: The Hitavada Date: 27 Dec 2016 09:45:00|
THE rally in the previous session proved to be a temporary breather as the NSE Nifty on Monday slumped to a 7-month low of 7,908 and the Sensex below 26,000, hit by talk of higher taxation after Prime Minister’s remarks.
On Saturday, Prime Minister Narendra Modi had said market participants should contribute to nation-building in a “fair, efficient and transparent way” and promised more “sound and prudent policies and reform measures”, which was seen by some as the Government planning to impose long-term capital gains tax on profit made from investment in shares.
Though Finance Minister Arun Jaitley on Sunday sought to clear the air saying the Government has no such intention, investors were already a nervous lot. This triggered selling, which saw the benchmark index fall.
The 50-share Nifty after cracking below the 7,900-mark settled lower by 77.50 points, or 0.97 per cent, at 7,908.25. This is its lowest closing since May 24 this year when it came in at 7,748.85.
The BSE Sensex resumed lower and dropped further before ending at a fresh one-month low 25,807.10, a loss of 233.60 points, or 0.90 per cent.
“Finance minister’s reassurance dispelling rumours soothed markets, but with FIIs continuing their preference for cash, buying interest remained thin,” said Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services.