Sensex, Nifty fall nearly 1% each on STT hike, other concerns

Petrochemical stock surges

The Indian stock market fell for the third week in a row because of high volatility and a lot of selling after the government raised the securities transaction tax (STT) on futures and options contracts and made other changes in the Finance Bill 2023.

At the end of the day, the Nifty 50 index was down 0.77 percent, or 131.90 points. It ended at 16,945.05, which is above the psychological level of 17,000. At 57,527.10, the S&P BSE Sensex dropped 398.18 points, or 0.69 percent. Both of the benchmarks lost nearly 1% in a single week.
All of the sectoral indices ended in the red, with Media, Metal, Realty, and PSU Bank falling the most. IT was strong throughout the session, but there were small losses at the end.
The Sensex companies that lost the most were Bajaj Finserv, which fell 3.81%, Tata Steel, Reliance Industries, HCL Tech, SBI, Larsen & Toubro, Mahindra & Mahindra, Axis Bank, and Titan.

Kotak Mahindra Bank, Infosys, Tech Mahindra, Power Grid, Asian Paints, and Wipro, on the other hand, were the winners.

According to the updated Finance Bill, debt Mutual Funds (MFs) will now get short-term capital gains if they invest less than 35% of their assets in stocks.

Future and Option (F&O) trading will cost more starting April 1, 2023, because an amendment to the Finance Bill 2023 will raise the Security Transaction Tax (STT) on the sale of futures and options. Lok Sabha passed an amendment to the Finance Bill 2023 on Wednesday. It says that the STT on the sale of options has gone up by 23.52%.

“Both the international and domestic markets gave us little to go on. Tax changes and getting rid of the indexation benefit of debt mutual funds were big blows to the asset management business. European markets were weak, which was caused by bank stocks as CDS spread went up. This made the volatility worse. Even though all of the major markets were in the red, there wasn’t much selling in the IT market despite warnings of slow growth “Vinod Nair, who is in charge of research at Geojit Financial Services, said this. Bank Nifty, on the other hand, fell by 221 points, or 0.56%, to 39,395. On Friday, 41 of the stocks in the Nifty 50 fell.

“On the last day of the week, the Bank Nifty bears took over, and the index ended on a negative note.” The index stays in a sell-on-rise mode as long as it doesn’t go above 40,000. Downside support is at 39000, and if this level is broken, the price will drop sharply. The weakness of the index is confirmed by the fact that the momentum indicator RSI is in the “bearish” zone “Senior Technical and Derivative Analyst at LKP Securities Kunal Shah said.

The rupee fell by 25 paise against the US dollar, ending the day at 82.45.

Brent crude, which is used as a global standard for oil, fell 1.73 percent to USD 74.60 per barrel.

According to data from the exchange, Foreign Portfolio Investors sold stocks worth 995.01 crore on Thursday after taking a day off.

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Source: Team CuurencyVeda