19% of total stocks traded on BSE hit lower circuit

19% of total stocks traded on BSE hit lower circuit

Out of 473 stocks that were locked in lower circuit filter, 93.44% or 442 were from BSE B and BSE S group.

Lower circuit is the days minimum possible level to which stock can fall with no buyers available at that point.

The market breadth, indicating overall health of market was weak. On BSE, 1969 shares declined as compared to 445 that advanced. 35 remained unchanged.

Meanwhile, BSE Sensex was down 141.43 points or 0.85% to 16,536.45, extending last two days' fall caused by Budget blues. Traders, domestic funds and some foreign institutional investors (FIIs) are likely to be hit by a hike in short term capital gains tax on sale of shares to 15% from 10%, which amounts to a massive 50% hike in the tax rate, in Union Budget 2008-09 announced on Friday, 29 February 2008.

The change in tax treatment of the Securities Transaction Tax (STT) in the budget, meanwhile, may impact arbitrage volumes on the bourses. STT will now be treated like any other deductible expenditure against business income for the assesse. This is against the current practicse whereby an assesse gets 100% rebate for STT paid against the tax liability for the year. A fall in arbitrage will result in decline in liquidity on the bourses.