Chill out zone

Prime Minister Narendra Modi at the inauguration of a new campus of National Institute of Securities Markets NISM along with from L FM Arun Jaitley Maharashtra Governor C Vidyasagar Rao CM Devendra Fadnavis and Union Corporate Affairs Minister Arjun Ram Meghwal at Patalganga PicPTIMarkets lost ground on the first four days of last week making it seven consecutive days of loss before a technical bounce on Friday helped markets recover some lost ground The BSESENSEX lost 44886 points or 169 per cent to close at 2604070 points while NIFTY lost 15370 points or 189 per cent at 798575 points The broader markets saw the BSE100 BSE200 and BSE500 lose 209 per cent 2245 and 227 per cent respectively BSEMIDCAP lost 389 per cent and BSESMALLCAP was down 261 per centIndian Youth Congress activists shout antiGovt slogans and burn an effigy following accusations from Congress vicepresident Rahul Gandhi that PM N Modi had received lsquoblack moneyrsquo in New Delhi PicAFPOf many lossesThere was no sectoral gainer The one which lost the least was BSEOILampGAS down a mere 025 per cent The top loser was BSEHEALTHCARE down 425 per cent followed by BSEMETAL 422 per cent and BSEBANKEX 265 per cent In individual stocks the top gainer was GAIL up 397 per cent followed by Cipla 296 per cent and HDFC Bank 046 per cent The losers were led by Axis Bank down 726 per cent followed by State Bank of India 586 per cent Cairn India 490 per cent and Bharti Tele 466 per cent PSU banks were losers with Union Bank down 775 per cent Canara Bank 672 per cent and Bank of Baroda 417 per cent Dow Jones continued its winning streak and gained 9040 points or 046 per cent to end at 1993381 points The Indian rupee lost six paisa or 009 per cent to close at R 6782About the exchequerThe Prime Minister Narendra Modi spoke at the inauguration of National Institute of Securities Markets NISM campus near Mumbai on Saturday He said ldquoTo some extent the low contribution of taxes may also be due to the structure of our tax laws Low or zero tax rate is given to certain types of financial income I call upon you to think about the contribution of market participants to the exchequer We should consider methods for increasing it in a fair efficient and transparent way Earlier there was a feeling that some investors were getting an unfair deal by using certain tax treaties As you know those treaties have been amended by this government Now it is time to rethink and come up with a good design which is simple and transparent but also fair and progressiverdquoQuell initial panicPnotes and GAAR are quite clear One is not quite sure what he is hinting at but he surely wants more revenue from the markets STT is already there and dividend distribution tax which is effectively a double tax is also there Further entities and individuals who receive more than R 10 lakh as dividend in one year have been subjected to an additional 10 per cent tax The presence of the Finance Minister A Jaitely and his Ministers of State as well as the Revenue Secretary Shaktikanta Das makes his comments significant While this is enough to rattle a market one needs to follow it up more carefully as the immediate assumption may not be correctThe pressure showsDecember series futures will expire on Thursday December 29 The previous series had expired at a level of 796550 points The current close is higher by a mere 20 points and this is after the monthly high for the series was 8275 points This clearly shows that the month has been under pressure With four trading days to go and a lead of merely 20 points the series could go in either direction The fact that markets are currently weak and volumes seem to be falling on lack of serious interest in the markets the pressure would be on bulls It therefore makes sense that one should sit out rather than trying to squeeze a rupee from the marketEnjoy the eventsTo conclude we are in the festive part of the year drawing to a close and by the time you read this piece Christmas will be over The year 2017 will be on us in less than a week Sit out chill out and enjoy the events as they unfold The market is certainly not the best place to be in at this timeArun Kejriwal is founder of the Mumbaibased advisory firm Kejriwal Research amp Investment Services Pvt Ltd Disclaimer No financial information whatsoever published anywhere in this newspaper should be construed as an offer to buy or sell securities or as advice to do so in any way whatsoever All matter published here is for educational and information purposes only