The domestic stock market picked up a sudden massive uptick in momentum in the last hour as BSE Sensex, the 30-share index, settled 1,109.10 or 1.54 per cent higher at 73,033.78. The market was trading higher throughout the session on an uptick in HDFC Bank shares and buying in IT stocks. However, Finance Minister Nirmala Sitharaman’s comment on Long Term Capital gain lifted the sentiment further.
With this rally investors the combined market cap of listed companies rose more than Rs 4.12 lakh crore to Rs 470 lakh crore, giving a significant boost to investors’ money.
Open To Hear Views On LTCG: Sitharaman
Speaking at the Bloomberg New Economy Forum, the Finance Minister said that long-term capital gains tax (LTCG) and securities transaction tax (STT) are being discussed at domestic and international forums.
She further stated that there has been extensive discussion on the transaction tax and whether different asset classes should be taxed uniformly. Though, Sitharaman did not confirm any changes in capital gains tax in the next budget.
What Is LTCG And How Its Removal Could Impact Investors
Long Term Capital Gain (LTCG) is a form of tax that investors pay if they sell securities--Stocks, Mutual Funds Units, ETFs-- after holding them for more than a year. Currently, investors pay 12.5 per cent LTCG on long-term investments in the capital market.
Removing LTCG could bring significant relief for retail and individual investors. Assume that if an individual records a profit of Rs 1,00,000 after holding an investment for over a year, then he pays Rs 12,500 as LTCG after an exit.
Removing the taxation could be a significant relief for retail and institutional investors.
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IT Stock Rally
A sustained gaining momentum in IT stocks kept the market firm throughout the session. HCL Tech jumped 8.28 per cent on the back of strong Q2 earnings, reporting a 21.18 per cent rise in consolidated net profit to Rs 5,132 crore for the July-September quarter of FY27.
Additionally, Tata Consultancy Services shares continued their uptrend, rising by 6.59 per cent. Tech Mahindra and Infosys were up 4.90 and 4.44 per cent, respectively.
Other Gainers: HUL, Titan, Bajaj Finserv, SBI, HDFC Bank, Mahindra and Mahindra and ICICI Bank settled in positive territory.