FM saves the week; Sensex snaps 5-week losses, up over 42 pts
Frenzied buying on the last day of the week helped the benchmark Sensex to snap its five weeks losing streak, thanks to clarification given by the finance minister on participatory notes, and to end modestly higher by over 42 points at 17,404.20.business Updated: Mar 31, 2012 16:14 IST
Stocks: Frenzied buying on the last day of the week helped the benchmark Sensex to snap its five weeks losing streak, thanks to clarification given by the finance minister on participatory notes, and to end modestly higher by over 42 points at 17,404.20.
After falling back below 17K-mark on Thursday to a two-month low of 16,920.61, the Bombay Stock Exchange 30-share barometer last day bounced back to end at two-week high of 17,404.20, showing a rise of 42.46 points, or 0.24%. In last straight five weeks it had plunged by 927.61 points, or 5.07%.
The NSE wide-based 50-issue Nifty also rose by 17.35 points or 0.33% to 5,295.55.
Stock markets have been weak since the central bank said after a mid-quarter policy review on March 15 that risks to inflation have increased due to higher crude prices, the large fiscal deficit and weakening currency.
The market got a further jolt after the Union Budget 2012-13 on March 16 announced various negative proposals, including move to retrospectively amend the Income Tax Act to bring in the net overseas deals that involve Indian companies amid hike in excise duty.
Analysts said investors off-loaded positions amid market speculations that the government may tax participatory notes (P-notes) of foreign investors for buying Indian equities.
Clearing the air on the issue, finance minister Pranab Mukherjee on Friday said, "Indian tax authority would not go beyond financial investor (FIIs) to check the details about the P-Note holders. Accordingly, a question of liability for tax in India of the P-Note holder would not arise. Necessary clarification will be issued."
As a result, the market rebounded sharply on the last day of the week.