The Indian rupee weakened against the US dollar slipping 47 paise as the benchmark Sensex sank 947 points in two days after Finance Minister taxed the LTCG (Long-Term Capital Gain) on equities over Rs 1 lakh at 10% in Budget 2018.
The Indian rupee weakened against the US dollar slipping 47 paise as the benchmark Sensex sank 947 points in two days after Finance Minister taxed the LTCG (Long-Term Capital Gain) on equities over Rs 1 lakh at 10% in Budget 2018. The sentiments of stock market investors seemed to have distressed as before Budget 2018, LTCG were tax-exempt. FM Jaitley’s move to bring the LTCG under the tax net has severely affected the stock and currency markets over the last two days. The domestic currency had lost 47 paise in the two-day session on February 1 & 2. The rupee had lost as much as 47 paise at 64.06 against the US dollar at the interbank foreign exchange market in two days. In today’s trade, rupee witnessed a decline of 3 paise after shedding 17 paise in the intraday trades.
During the day, the rupee hovered in a range of between 63.74 and 64.20. The Reserve Bank of India fixed the reference rate of the rupee at 64.0781 against the US dollar on Friday. On the other hand, Indian equities came under heavy selling pressure following the introduction of LTCG. The S&P BSE Sensex saw a vertical decline of 946.8 points or 2.63% in the last two days while the Nifty 50 index had fallen 291.1 points or 2.64% in the corresponding period. Earlier yesterday, the domestic currency slumped 44 paise at 64.03 apiece US dollar.
Meanwhile today, In a major offshoot of Union Budget 2018 presented by Finance Minister Arun Jaitley on Thursday, the 30-share Sensex registered its biggest single-day fall in two-and-a-half years, and plummeted by 840 points to settle at 35,066.75. During the week, Sensex had fallen 983.69 points below from the previous week’s closing of 36,050.44. The broader Nifty ended below the 10,800-mark, shedding as much as 256.3 points or 2.33% to finish at 10,760.6 as the post-Budget sell-off continued for the second straight day.
In a major development in Budget 2018, Finance Minister Arun Jaitley introduced a tax on LTCG (Long-Term Capital Gain) on shares over Rs 1 lakh at 10%. Following which a knee-jerk reaction was observed in the Indian equities on Thursday as amid a heavy sell-off pressure, in the intrday trades on Thursday, BSE Sensex plunged 463.28 points to hit an 8-day low of 35,501.74. Finance Minister Arun Jaitley on Thursday fixed the fiscal deficit target for the fiscal year 2018-2019 at 3.3%, higher than previous year’s 3.2% target on account of shortfall in non-tax revenue due to deferment of spectrum auction.