FinMin’s cut to corporate tax force Sensex soar over 1,300 points, reclaiming 39,000 level; Nifty above 11,500

Extending its euphoria over government’s economy-boosting measures, equity benchmark BSE Sensex soared over 1,300 points to reclaim the 39,000 mark in early session on Monday, driven by gains in index heavyweights HDFC Bank, ITC, L&T and ICICI Bank.

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After hitting a high of 39,346.01 points, the 30 share index was trading 1,031.58 points, or 2.71 per cent, higher at 39,046.20, while the broader Nifty rallied 263.75 points, or 2.23 per cent, to 11,537.95.

In the previous session on Friday, the BSE barometer logged its biggest single day jump in over a decade by surging 1,921.15 points or 5.32 per cent to 38,014.62, while the NSE Nifty zoomed 569.40 points or 5.32 per cent to end at 11,274.20.

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Bulls took over Dalal Street after Finance Minister Nirmala Sitharaman delivered a surprise cut in corporate tax rates. Announcing the latest set of measures to jump-start flagging growth, the Finance Minister slashed the base corporate tax for existing companies to 22 per cent from 30 per cent; and for new manufacturing firms, incorporated after October 1, 2019, to 15 per cent from 25 per cent.

Market continued to rally on Monday as sentiment investor remained euphoric in opening session. Corporate tax rate cut is a huge step in boosting the overall profitability of corporate India. This step along with some of the other measures announced including that the enhanced tax surcharge introduced in July 2019 shall not apply to capital gains on sale of equity share which is subject to securities transactions tax would go a big way in restoring confidence in the Indian equity markets.


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