Nifty, Sensex mark biggest single-day gains in a decade

The markets reacted positively to all the announcements made by Finance Minister on Friday as the indices surge by more than 5 per cent intra-day. The tax rate cuts for the corporates are expected to be extremely positive for the economy and hence, will give a much needed boost to the markets.

The tax cut announcements drove the benchmark indices Nifty and Sensex and the sectoral index Bank Nifty to gain most in a single day in last 10 years. The 50-share index Nifty had fallen to levels below 10800, which was considered as big support level in near term, earlier this month. The announcements helped the index not only to cross the support level but also regain the 11000 mark.

At 12:11 pm, Nifty was trading at 11,266.20, up by 561.40 points or 5.27 per cent and Sensex was trading at 38,028.26, up by 1934.79 or 5.36 per cent.

The indices were helped due to robust gains in all the sectoral indices. In fact, the Nifty Bank too followed the benchmarks and registered biggest ever single day gain. Among the broader market indices, the mid cap index registered biggest single day gain on four months.

The boost to corporates and new corporate manufacturing companies via tax rate cuts can have positive impact on the economy. Earlier this week, the government had also announced measures for MSMEs which has very high percentage in midcap stocks. Hence, the proposed changes in these taxes can be trend changing, provided the global cues remain positive too.

At 12.00 pm, shares of Maruti Suzuki, HDFC Bank and L&T were trading higher as much as 10 per cent, 8 per cent and 7 per cent, respectively on BSE Sensex. The BSE Midcap index was trading higher by 3.46 per cent with Ashok Leyland being the biggest gainer with 11 per cent intra-day.