Volatility in Indian markets may continue for some time: Sebi chief
New Delhi: Volatility in the Indian markets may continue for some time due to global reasons, but there are no issues of concern for investors in terms of safety and security of the Indian marketplace, Sebi chief Ajay Tyagi said on Saturday.
In the wake of concerns raised in some quarters about the re-introduction of long-term capital gains tax (LTCG), as proposed in the Budget 2018, Tyagi said the Securities and Exchange Board of India (Sebi) has not received any representation from investors so far against this.
He, however, said it will be wrong to say long-term capital gains tax will have no impact at all on Indian markets. But, any such impact would be small and the global factors pose bigger risks, Tyagi added. When asked about the timing of imposing the LTCG, Tyagi said it was an opportune time as markets were booming.
Finance minister Arun Jaitley, on 1 February, had proposed to tax LTCG on equities exceeding Rs1 lakh at 10%, which is expected to bring in a revenue of Rs20,000 crore.
Speaking about the markets, Tyagi said that volatility in Indian markets may continue for some time due to global reasons like the healthy US job markets numbers. Indian stock markets have been falling in the last few trading sessions, which experts attributed to global worries.
The Sebi chief said that the government’s proposal to mandate listed companies to raise 25% funds via corporate bonds is a good step and the detailed rules will come out by September.
Currently, BSE’s Sensex has been hovering at 34,000 level. The benchmark indices fell by over 1% yesterday to close at a one-month low level. While the Sensex had managed to gain 330 points on Thursday, it had lost more than 2,200 points in the preceding seven trading sessions amid negative domestic and global cues.
Experts believe that the latest US jobs data spooked global markets, prompted worries about inflation rising at a faster pace. This has led to a possibility that the Federal Reserve — the US central bank — could raise rates at a faster pace than expected this year.
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