It's a cul-de-sac for FPIs! If they have ended up facing collateral damage from the new income-tax surcharge on the super-rich, there seems to be no way out of it. Even if they want to convert into companies from trust structures to avoid the extra tax, they would need to wait till next Budget for a policy change to make such conversions tax-neutral. So, no escaping the levy for now, which is why the rush to exit.
STREET PULSE: Where we stand  | Nifty futures on Singapore Exchange traded nearly 60 points down at 7 am (IST), signalling pain ahead for Dalal Street. Stocks took a beating globally after President Trump's threat to slap fresh tariff on Chinese imports. MSCI index of Asia-Pacific shares outside Japan fell 0.51 per cent to its lowest level since mid-June while Nikkei tumbled 1.91 per cent. On Wall Street, Dow fell 1.1 per cent, the S&P500 0.9% and the Nasdaq 0.8%. Read More |
| Oil prices rose around 1%, steadying after an overnight plunge following the Trump threat. Brent slumped more than 7%, its steepest drop in over three years. WTI crude fell nearly 8 per cent, posting its worst day in more than four years. Read More |
| LOOK WHO'S |  |
Green shoots?... India's manufacturing activity strengthened in July, led by a pickup in demand, improved output and new orders. The Nikkei India Manufacturing PMI rose to 52.5 in July from 52.1 in June, staying above the 50-point mark that separates expansion from contraction. That performance came despite dismal infrastructure growth and sluggish car sales.
Read More Relief!... India's gross GST collections stood at Rs 1.02 lakh crore in July 2019, rising 5.8 per cent from same month last year. Total gross GST revenue collected in July stood at Rs 1,02,083 crore while revenue collection was Rs 96,483 crore. GST collections had dipped below the psychological Rs 1 lakh crore mark in June 2019 to Rs 99,939 crore.
Read More | WHO'S |  |
Back to Square One...
President Donald Trump abruptly escalated his trade war with China, announcing plans to impose 10% tariff on a further $300 billion Chinese imports in a move that is set to hit American consumers more directly than any other in his trade wars so far. The new taxes, which Trump later said could go "well beyond" 25%, will be imposed beginning Sept. 1 on goods ranging from smartphones, laptops to children's clothing.
Read More Root cause... A sudden drop in margin funding and increased focus on risk management by brokers triggered the selloff in stocks on Dalal Street over the past few days even as FIIs continued to exit local equities. Brokers who wanted to cover risks have apparently told HNI clients to bring in additional margin or cut exposure. Several of them chose the latter, triggering the crash, especially in midcap stocks.
Read More Meanwhile... Citigroup Global Markets has cut its March 2020 Sensex target to 39,500 from 41,000 to factor in downgrades in corporate earnings growth forecasts. This is the first cut in Sensex target by any brokerage since the recent market decline began.
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