Budget Pulls Sensex Down To 9-Month Low!

Stock benchmarks Sensex and Nifty plummeted for a second straight session to their biggest single-day fall in over nine months, dragged down by heavy losses in PSU bank, realty, power and auto stocks as the Union Budget failed to provide any impetus to Dalal Street.

Monday’s fall was the biggest since April 2016 in percentage terms. The Sensex fell 793 points or 2.01 per cent to close at 38,720.57 and the NSE Nifty 50 Index tumbled 2.14 per cent or 252.55 points to shut shop at 11,558.60, reports NDTV.

The development follows the government’s proposal to increase the minimum public shareholding in listed companies and to raise tax incidence for foreign portfolio investors and high net-worth individuals in its Budget.

“I have asked SEBI to consider raising the current threshold of 25 per cent to 35 per cent,” Finance Minister Nirmala Sitharaman said while presenting the first Budget in Prime Minister Narendra Modi’s second term in Parliament on Friday.

Auto and banking shares were among the worst performers in Monday’s session amid broad-based selling pressure.

“Higher tax incidence proposed in the Budget for foreign portfolio investors and high net worth individuals is spooking the markets,” AK Prabhakar, head of research at IDBI Capital, told NDTV. “The proposal to increase minimum public shareholding for all listed companies in Budget is also impacting the markets negatively.”