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A news of capital gains is being blamed for the market decline on Friday. The Finance Minister himself clarifying this and calling it a rumor is being considered a good sign for the Indian stock market in the coming week, but in view of the weak job data in America, it is expected that the US Federal Reserve will reduce the interest rate and its The Indian market will also be positively affected in the coming week.
When the Reserve Bank of India last announced the decision of its monetary policy meeting, experts said that the RBI will follow suit only after the US Federal Reserve cuts interest rates. Now the hope that has arisen in this regard in America, it is expected that RBI will also implement this sooner or later, which will have a positive impact on the Indian stock market as well.
After the inflation rate was 7.8 percent in February 2022, RBI increased the interest rate by 2.75 percent and now the inflation rate has come down to 4.9 percent. Apart from this, RBI has not made any change in the interest rate for the seventh consecutive time. Therefore, now it is expected that this will also reduce the interest rate.
If interest rates fall in the US, various companies may increase spending on IT. Therefore, this bodes well for Indian IT companies which derive most of their revenue from the US. Apart from this, if the interest rate is reduced by RBI for the auto sector which is considered sensitive in terms of interest rate, then it can also prove beneficial. This is also a good sign for the banking sector, but the increased provision by RBI for project financing may impact the shares of this sector.
Markets fall on capital gains tax change report, Finance Minister's clarification finally brings some improvement
On Friday, after opening nearly 500 points higher, the Sensex suddenly fell, closing 1,200 points below the high after a total swing of 1,600 points, leaving market players stunned. Experts gave many reasons for saying this, but no reason was acceptable except that the US job data was about to be announced. However, it is true that there were reports in a news media that after the BJP government comes back to power, some new steps will be taken in the matter of income tax, under which taxes including capital gains tax will be imposed on all types of properties. Should be standardized. After this news, heavy selling started in the market in the afternoon. However, some recovery was seen in the last hour because Union Finance Minister Nirmala Sitharaman herself posted about this report on the X platform and clarified that it is just a speculation and there is no fact in it. Elections are going on hence such a thing has been spread. Following the relevant report, there was a fear among market players that the existing relief on long-term capital gains tax on stock market gains would be withdrawn and short-term capital gains tax would also be levied at a higher rate.
All major US stock market indices rose 1.18 percent to 1.99 percent
US jobs data released on Friday came in lower than experts expected, raising hopes the US Federal Reserve could cut interest rates to boost the economy. Due to which America's stock markets closed with huge gains. An increase of 1.18 percent to 1.99 percent was recorded in the three major indices of America. The Dow Jones closed up 450 points or 1.18 percent, the Nasdaq closed up 315 points or 1.99 percent and the S&P 500 closed up 63 points or 1.26 percent. The technology index closed up 3 percent and all S&P regional indexes except the energy index closed higher.