Indian shares set to open lower; L&T, Axis Bank in focus
Changes to derivatives from derivating in paragraph 1
BENGALURU, July 25 (Reuters) -Indian shares are set to open lower on Thursday amid soured investor sentiment after the government's tax hikes on equity investment gains and derivatives trading, while Larsen and Toubro and Axis Bank will be in focus post quarterly earnings.
The GIFT Nifty was at 24,174.5 points as of 8:10 a.m. IST, suggesting that the Nifty 50 index .NSEI will open below its Wednesday's close of 24,413.5.
The Nifty 50 has logged losses for four straight sessions, falling about 1.5% from record high levels, hit last week.
Two of those sessions came after the union budget on Tuesday, in which the government hiked tax on long-term and short-term capital gains and derivatives trading.
"While the increase in short-term capital gains tax is understandable given the need to curb excessive short-term speculation, the increase in LTCG (long-term capital gains) is regressive, especially the optics of it," said Abhishek Goenka, founder and chief executive of treasury and wealth management firm IFA Global.
While the tax increase in LTCG may not dim the allure of equity as an asset class, it is a step backwards in terms of incentivising long-term investments, Goenka added.
Meanwhile, Asian peers were trading lower after the U.S. stocks fell overnight on weak earnings from major companies. MKTS/GLOB
On the earnings front, the focus will likely shift to infrastructure major Larsen and Toubro LART.NS, which posted a quarterly profit beat on strong order execution.
Private lender Axis Bank AXBK.NS will also be closely watched after it reported a smaller-than-expected first-quarter profit, on higher provisions amid a deterioration in asset quality.
Foreign investors remained net sellers for the second straight session, offloading shares worth about $1 billion in two sessions since the union budget.
STOCKS TO WATCH-
* Sun Pharma SUN.NS: Australia's Mayne Pharma MYX.AX has filed a patent infringement lawsuit against Sun in a U.S. Court.
* Jindal Steel JNSP.NS: Company reported a drop in first-quarter profit on higher costs, frail demand
* Earnings in focus: Nestle NEST.NS, Tech Mahindra TEML.NS, Adani Green ADNA.NS
($1 = 83.7530 Indian rupees)
Reporting by Manvi Pant and Bharath Rajeswaran in Bengaluru; Editing by Eileen Soreng
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