Chidambaram Fails To Impress Markets

The BSE 30 scrip Sensex opened strong at 3526.38 against a previous closing of 3516.90. It touched an intra-day high of 3543.21 before closing at 3508.07, down 8.83 points over the previous close.

The NSE 50 index opened at 1038, touched a high of 1039 before closing at 1032, losing five points over the previous close of 1037.

The SBI stock witnessed hectic trading on major bourses. On the BSE, the stock witnessed trading in 47.94 lakh shares at a value of Rs 135.21 crore, while on NSE, the stock showed trading values of Rs 320.37 crore.

ITC was also highly traded on the NSE with a traded value of Rs 95.24 crore, while on the BSE, ITC witnessed a trading of Rs 23.67 crore. Reliance Industries saw poor trading with a turnover of Rs 83.69 crore on the NSE and Rs 46.32 crore on the BSE.

 

The sentiments improved mainly because of the announcements made by the finance minister P Chidambaram which included: extension of capital gains exemption to investments in mutual funds, raising the level of exemption on interest income from Rs 13,000 to Rs 15,000 and doubling the bank advances limit for individuals to Rs 10 lakh against security of shares and debentures.

Trading volumes were steady with the net traded volume touching Rs 728.86 crore on the NSE and Rs 393.99 crore on BSE. On the NSE, the total volume of shares traded were 386.17 lakh and the number of trades 73,827. On the BSE, the total number of shares traded were 325 lakh, including 139 lakh shares from the specified group.

The news of a cut in the capital gains of partnership firms from 30 to 20 per cent and capital gains exemption for ploughing back of gains in specified assets notified by the Central Board of Direct Taxes (CBDT) like debentures and units of mutual funds also boosted sentiments.

While enhancing the exemption limit under 80 (I) of the income tax, the minister has proposed to revert to a two-part arrangement under which Rs 3,000 would be exclusively reserved for income from investment in shares and mutual funds. It has also been decided to allow FIIs to invest upto 100 per cent of their funds in debt instruments from the earlier 30 per cent.

Most of the specified group stocks witnessed hectic trading with Tata Power and Tata Steel moving up over their previous levels. Reliance Industries which on the BSE, had a previous close of Rs 208.5, opened at Rs 210 but fell towards the close to Rs 207.50, on the NSE, the scrip closed at Rs 208.95 against an opening of Rs 211.55, and a previous close of Rs 210.70.

The SBI stock was also actively traded. After opening at Rs 283 to 285 levels the stock closed at Rs 280 on the BSE and Rs 282.25 on the NSE.