Sensex fails to hold record high, Nifty ends flat; Midcap underperforms
Equity benchmarks started off day on a positive note Thursday, with the Sensex hitting a record high of 31,522.87 (up 239 points intraday) but failed to hold those gains in last hour of trade.
The 30-share BSE Sensex was up 7.10 points at 31,290.74 and the 50-share NSE Nifty was down 3.60 points at 9,630.
Weak global cues and the sell on rally strategy by traders caused profit booking in late trade while investors cautiously awaited GST implentation effective from July 1.
“India is expected to usher in the largest-ever indirect tax reform, GST, from July 1, the current trend on inventory de-stocking makes it amply clear that the June quarter numbers for most businesses will be subdued,” Mahesh Nandurkar of CLSA said.
He believes business financials will begin to normalise from the September quarter.
Structural benefits of better tax compliance leading to higher tax-to-GDP ratio, seamless trade across the country driving improved logistics and corporate efficiencies, and shift in business from unorganised to organised should be visible with a lag of 3-4 quarters, Nandurkar feels.
The broader markets underperformed benchmarks, with the BSE Midcap and Smallcap indices falling 0.6 percent each. About three shares declined for every share rising on the exchange.
More to come…
