Sensex shoots on tax incentives

Sensex closed on Friday’s session with an unprecedented 5.32 per cent advance as Finance Minister Nirmala Sitharaman announced yet another big ticket announcement to kickstart the economy.

Indian benchmark indices logged the biggest-ever gains in over 10 years as the government slashed the effective corporate tax rate to about 25 per cent from 30 per cent.

Sensex advanced by a massive 1921.15 points to 38,014.62 and the broader Nifty jumped to 11,275.45 after gaining 570.65 points or 5.33 per cent.

The biggest beneficiaries among the 30 Sensex stocks were: HeroMoto Corp, Maruti Suzuki, IndusInd Bank, Bajaj Finance, State Bank of India and Bajaj Finance which gained in the range of 9 to 12 per cent.

The badly beaten down auto stocks, gained the most. Nifty auto jumped over 9.90 per cent while the Nifty banks index gained over 8 per cent.

“The announcements made by the Finance Minister are very positive for the economy, corporates and stock market. The effective tax after surcharges and cess will come down from 33 per cent to 25.17 per cent, “ said Rusmik Oza of Kotak Securities.

Meanwhile, Congress leader Rahul Gandhi on Friday took a swipe at the tax incentives announced by the Centre, saying it was aimed to push up the stock market ahead of Prime Minister Narendra Modi’s US tour when he is expected to meet many foreign investors.

Taking a pot shot at the Rs 1,45,000 crore revenue that the government will have to forego due to the reduction in corporate tax rate and other relief, Rahul Gandhi said that the Prime Minister’s trip is proving to be the world’s most expensive event ever.

Agencies