The Hindu : Business : Sensex ends flat in volatile trading

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Sensex ends flat in volatile trading

Survey’s recommendation to rationalise DDT plays spoilsport

MUMBAI: The Bombay Stock Exchange sensitive index, Sensex, closed flat on Thursday after a high-level of volatility as the hike in fuel prices and recommendation of the Economic Survey to rationalise dividend distribution tax (DDT) played spoilsport in a bullish market.

Weakness in European stocks in early trade also weighed on investor sentiment.

The BSE 30-share barometer closed at 14658.49, up 13.02 points from its previous close.

The market was choppy throughout and fluctuated between 14764.35 and 14469.69 during the day.

Bourses shrugged off factors such as minus inflation and the Survey’s suggestion for a review and phasing out cesses, surcharges and transaction taxes such as fringe benefit tax (FBT), Securities Transaction Tax (STT) and Commodities Transaction Tax (CTT).

The Survey also suggested aggressive disinvestment and financial sector reforms to bring the economy back to a high-growth track as well as free pricing of fertilizer and fuel.

Inflation rate stayed negative for the third week in a row at minus 1.3 per cent for the week ended June 20. However, a ten per cent hike in petrol and diesel prices caused concerns about adverse impact on inflation.

Marketmen said the suggestion for rationalisation of DDT induced fears that the government might make dividend taxable in the hands of the shareholders.

Reflecting a surge in its top heavyweight ONGC, the National Stock Exchange 50-share Nifty gained 7.95 points to close at 4348.85.

ONGC gained 7.02 per cent following a petrol price hike as also relatively low global crude prices compared to last year, which will reduce its fuel subsidy burden in the current year.

PSU stocks attracted brisk activity after the Economic Survey recommended a disinvestment target of a minimum of Rs. 25,000 crore annually.

GAIL India spurted by 7.85 per cent, Hindustan Copper by 4.99 per cent and HPCL by 2.73 per cent.

Rupee ends weaker

The rupee turned weaker after the initial firmness and ended five paise lower at 47.94/95 against the dollar on Thursday.

It closed at 47.89/90 on Wednesday. The dollar had touched a three-week low against the euro in New York on Wednesday.

In fairly active trading, the domestic currency resumed higher at 47.80/81 a dollar and later moved in the range of 47.72 and 48.03 in line with volatile trading on the Indian bourses. — PTI

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