QBiz: Sensex Over 30K; Big Tax Cut Proposals Under Trump
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1. Sensex Surges Past Record 30,000-Mark, Rupee at 21-Month High
Sensex closed above the 30,000-mark for the first time on Wednesday, while the Nifty too finished at a record high on sustained buying amid positive global cues.
The Bombay Stock Exchange (BSE) 30-share Sensex opened on a strong footing and surged to an unprecedented 30,167.09 points in intra-day trade, before settling at 30,133.35, up 190.11 points, or 0.63 percent.
This surpassed its previous record close of 29,974.24, reached on 5 April. Similarly, the broader 50-issue National Stock Exchange Nifty scaled a new peak of 9,367, before finally ending at a new record closing of 9,351.85 – 45.25 points, or 0.49 percent higher than the previous day.
The rupee appreciated by 19 paise to trade at a nearly 21-month high of 64.07 against the dollar in early trade on Wednesday at the Interbank Foreign Exchange amid sustained selling of the American currency by exporters and banks.
2. Govt Will Not Impose Any Tax on Agriculture Income, Clarifies FM Jaitley
This came after Bibek Debroy, member of the Centre’s main think-tank, the NITI Aayog, seemed to suggest in an interaction with reporters on Tuesday that taxes should be imposed on farm income above a certain threshold to expand the tax base.
The Aayog, however, said Debroy’s views were ‘personal’ and not those of the Aayog. It also said that taxing farm income is neither the view of the Aayog nor has such a recommendation been made anywhere in the draft action agenda document, as circulated to the governing council at the meeting on 23 April. The council meeting was chaired by Prime Minister Narendra Modi and attended by almost all chief ministers.
3. Trump Government Moots ‘Biggest Tax Cut’; Raises Fears Over Deficit
In a dramatic move, the Donald Trump administration on Wednesday announced what it dubbed as the “biggest tax cut” and largest tax reform” in the history of the United States, justifying it on the ground that it would act as a catalyst to economic growth, creation of jobs as well increase middle-class prosperity.
Such reductions have been proposed for both personal income tax as well as corporate tax, with the latter seeing a cut from 35 percent to 15 percent.
4. First SEBI Board Meet Under Ajay Tyagi Sees Sweeping Changes in Trading Norms
The Securities and Exchange Board of India (SEBI) on Wednesday announced sweeping changes in norms relating to mutual funds, public issues, capital raising and commodity derivatives after its board met for the first time under new chairman Ajay Tyagi.
The regulator allowed new investment and redemption routes in mutual funds; tightened initial public offering (IPO) norms to ensure that funds raised are not misused; eased existing capital-raising norms to help banks deal with rising bad loans; and announced changes in securities contracts norms for better integration of the commodity derivatives market with the securities market.
5. CEOs at Indian IT companies Like Genpact, Infosys Take a Cut in Their Bonuses as Growth Slows
For executives of Indian IT firms, the last year has not been kind. CEOs from Genpact and Infosys to Cognizant have seen their performance bonuses shrink as the sector struggles for growth.
US-listed companies, which ask for a non-binding, advisory shareholder vote on the compensation, are saying they have missed their targets and need to be compensated accordingly.
Genpact CEO NV Tyagarajan was paid 700,000 dollars out of a 2016 target bonus of 1.12 million dollars, the IT and BPO company said in a proxy filing to the US Securities and Exchange Commission. He was paid 1.33 million dollars in his target bonus for 2015.
(Source: The Economic Times)
6. HDFC May Sell Realty, Digital Units to Quikr For 5% stake
Housing Development Finance Corp Ltd (HDFC) is in talks with online classifieds company Quikr India Pvt Ltd to sell its brokerage business HDFC Realty and its digital business HDFC Red in an-all stock deal, four people with direct knowledge of the matter said.
The size of the deal is likely to be Rs 350-400 crore and HDFC, India’s largest mortgage lender, will get a stake of around 5 percent stake in Quikr in return, said two of the people. The term sheet has been signed and the due diligence process is on, said one of the two persons.
7. Modi Sets Stricter Deadlines For Infrastructure Projects
Prime Minister Narendra Modi has asked for stricter implementation of timelines for completion of infrastructure projects during a review of the key sectors, including roads, railways, ports and telecom.
In a presentation made to the Modi on Tuesday, NITI Aayog CEO Amitabh Kant highlighted the progress made in several areas. The highest ever average daily construction rate of 130 km has been achieved for rural roads under the Pradhan Mantri Gram Sadak Yojana.
This had led to an addition of 47,400 km of PMGSY roads in 2016-17 and 11,641 additional habitations had been connected with roads, an official statement said.
In the highway sector, over 26,000 km of four- or six-lane national highways have been built in 2016-17 on a cumulative basis since the National Democratic Alliance came to power. This works out to roughly 24 km a day.
8. 22% Increase in Digital Advertising Expenditure in 2016; $72.5 Billion Spent by Marketers
Marketers spent 72.5 billion dollars on digital advertising last year, an increase of 22 percent from 2015, as Google and Facebook once again booked the lion’s share of new revenue, a report released by the Interactive Advertising Bureau said on Wednesday.
The Internet Advertising Revenue Report underscored a migration by consumers away from traditional forms of media like television to online and mobile platforms, which has left digital companies competing for a larger share of advertising dollars. However, digital and television advertising is not an apples-to-apples comparison.
Analysts for the Pivotal Research Group wrote that despite digital advertising outpacing the 69 billion dollars spent on US television advertising in 2016, it was not taking away ad dollars as many observers would expect.
9. FII Inflows Into Debt Market Might Be Limited To $5-10 Billion in 2017-18: Report
FII inflows into Indian debt market in 2017-18 are expected to be limited to 5-10 billion dollars, said a report released on Wednesday.
"Aggregate FII (Foreign Institutional Investors) inflows into the Indian debt market in 2017-18 are expected to be limited to 5-10 billion dollars, for which sufficient headroom exists within the existing limits for FIIs," said ICRABSE rating agency in its report.
"The bulk of the FII inflows into Indian debt in FY2018 will be in government securities (G-sec) or corporate debt, as concerns regarding the recent rise in state debt would be exacerbated by debt servicing for UDAY loans, pay revision and potential loan waivers by some state governments..." the agency said.
According to the report, FIIs interest in the Indian debt market has revived in the recent months.
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