New Delhi: The S&P BSE Sensex and NSE Nifty 50 indices saw a sharp sell-off on Friday. They ended at two-month low on July 19 after Finance Minister Nirmala Sitharaman dashed the hope of a tweak in FPI surcharge. Reports cite the passing of the Finance Bill for the current financial year without any amendments just a day ago as the reason.
What the passing of Finance Bill without amendments means is that the higher tax surcharge proposed for the super-rich was not rolled back, as the association of foreign portfolio investors had requested. Both BSE Sensex and NSE Nifty registered their worst single-day decline since July 8.
The Sensex fell 560 points or 1.44 per cent to close at 38,337 and the NSE Nifty 50 Index dropped 1.53 per cent or 178 points to settle at 11,419. A leading portal quoted research head of IDBI Capital, AK Prabhakar, as saying, “Finance Bill has been passed in Parliament without any significant change. Normally a lot of amendments happen when it goes to debate.”
“Somebody investing from abroad has a lot of choices and higher taxes make India a less lucrative investment destination,” Prabhakar reportedly said. Meanwhile, foreign portfolio investors had been selling shares in Indian markets after the Budget was announced on July 5 and till Thursday, they had sold worth Rs 1,983.82 crore, as the data compiled NSDL showed.