Sensex drops impose on long-term capital gains

The benchmark stock indices dropped nearly 1 per cent in morning trade due to selling in banking, auto, financial and telecom stocks after the budget proposal to impose a long-term capital gains (LTCG) tax on equity gains of more than Rs 1 lakh.

• The 30-share BSE Sensex dropped by 328.24 points or 0.91 per cent to 35,578.42 in morning trade as 25 of its constituents declined. The NSE Nifty fell below the key 11,000-mark as 38 of its components dropped. The 50-issue Nifty was trading down by 96.35 or 0.87 per cent at 10,920.55 at 1000hrs.
• Among major losers, private banks Kotak Bank, IndusInd Bank Yes bank, Axis Bank, ICICI Bank and HDFC Bank fell up to 2.9 per cent. 
• Adani Ports, HDFC, L&T and Reliance Industries, Maruti, SBI, Bajaj Auto, M&M, Coal India and NTPC also declined up to 2 per cent.
• IT major TCS and Infosys and drug makers Sun Pharma and Dr Reddy's, however, posted gains of up to 1.20 per cent on a weaker rupee.
• Sentiment took a hit after Finance Minister Arun Jaitley yesterday announced long-term capital gains tax of 10 per cent on stock market gains exceeding Rs 1 lakh.
• A weak trend in Asia also came as a dampener, traders said.With the Budget out of the way, the focus turns to RBI's monetary policy to be released later this month.
• Japan's Nikkei was down 1.30 per cent while Shanghai Composite Index shed 0.40 per cent in early trade today. Hong Kong's Hang Seng, however, up 0.20 per cent.
• Most of the US stock indices dropped overnight after concerns over political crisis and rising US Treasury yields.