SGX Nifty suggests negative opening to market; Asian markets falls most in a year

After a steep sell-off on Friday, the domestic market are expected to extend losses, tracking Asian markets, which fell the most in over a year on Monday as fears of resurgent inflation battered bonds, toppled Wall Street from record highs and sparked speculation that central banks globally might be forced to tighten policy more aggressively. 

At 8:15 am, the SGX Nifty, an early indicator of Nifty50’s movement on Singapore Stock Exchange, was trading at 10,591.50, down 127 points or 1.20 per cent. 

Removal of STT not on cards: Jaitley

To the dismay of market participants, Finance Minister Arun jaitley is unlikely to remove the Security Transaction Tax (STT), that was incorporated in 2005 when then FM P Chidambaram had removed the LTCG. That Long-term capital gains (LTCG) tax and STT both will stay is what Jaitley suggested in an interview with Zee Business. 

"STT has been there with STCG. Now it will exist with LTCG too. We have offered concessional rate. We exempted small investors by capping the profit for LTCG tax at Rs 10 lakh. I believe creamy layer is supposed to pay this tax. They can do that," said Jaitley. 

Global markets

MSCI’s broadest index of Asia-Pacific shares outside Japan shed 1.9 per cent in the largest daily drop since late 2016.

E-Mini futures for the S&P 500 fell another 0.44 per cent, an unusually sharp move for Asian hours and suggesting further losses in US markets later in the session.

Japan’s Nikkei sank 2.3 per cent, while Australia’s main index lost 1.3 per cent and Chinese blue chips slid 0.7 per cent.

On Wall Street, The Dow Jones Industrial Average fell 665.75 points, or 2.54 per cent, to 25,520.96, the S&P 500 lost 59.85 points, or 2.12 per cent, to 2,762.13 and the Nasdaq Composite dropped 144.92 points, or 1.96 per cent, to 7,240.95.

Investors were spooked by Friday’s US payrolls report which showed wages growing at their fastest pace in more than 8-1/2 years and fuelling inflation expectations.