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Sensex spurts 506 points on government move to pacify taxation worries

Market-UpThe benchmark BSE Sensex on Friday bounced back by 506.28 points to reclaim the 27,000-mark on government’s move to mollify overseas investors’ taxation worries and rupee’s recovery.

The 30-share index’s biggest gain in more than a month was also supported by value-buying in beaten-down stocks, drop in oil prices and gains in global stocks, traders said.

The rupee rebounding from 20-month lows to regain 63 levels too boosted sentiments and helped Sensex recover from its 6-1/2 months low, they added.

“Government’s move to set up a high level committee to decide MAT issue has helped market. This could reduce FII’s concerns over the medium-term,” said Vinod Nair, Head of Fundamental Research at Geojit BNP Paribas Financial Services.

Snapping three days of losses, the BSE Sensex resumed on a strong footing and quickly recaptured the crucial 27,000-mark to touch the day’s high of 27,196.28.

It finally closed at 27,105.39, a jump of 506.28 points or 1.90 per cent. Previously, it had soared by 517.22 points on March 30.

The gauge had lost 891.48 points in the previous three days to hit 6-1/2 months low on persistent worries over MAT and delay in passage of key reforms bills in Parliament.

The 50-share NSE Nifty after crossing the 8,200-mark, touched a high of 8,224.95 before closing 134.20 points or 1.67 per cent higher at 8,191.50.

Sentiments changed for the better after Finance Minister Arun Jaitley announced that a high-level committee will look into the issue of Minimum Alternative Tax (MAT).

Tata Motors was the biggest gainer on the Sensex, followed by Cipla, ICICI Bank, Hindalco, Bajaj Auto, HDFC Bank, HDFC, Axis Bank, RIL, Tata Power, L&T and ITC.

Share of FMCG major Hindustan Unilever rose 3.34 per cent after it reported a 16.73 per cent increase in its standalone net profit at Rs. 1,018.08 crore for the March quarter.

Bucking the trend, Hero MotoCorp was down 2.23 per cent after it reported a 14.05 per cent decline in net profit.

A firming trend at other Asian bourses following overnight gains in the US markets and a higher opening in Europe were other factors behind rebound in stocks, traders said.

Sectorwise, the BSE realty gained the most by surging 4.06 per cent, followed by auto by 2.67 per cent.

Meanwhile, foreign portfolio investors sold shares worth Rs 1,360.69 crore as per provisional data.

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