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After opening the day on a positive note, the Indian stock markets have added to their early gains. Sectoral indices are trading on a positive note with stocks from the banking, auto and pharma sectors leading the gains.
The BSE Sensex is trading up 146 points (up 0.5%) and the NSE Nifty is trading up 51 points (up 0.6%). The BSE Mid Cap index is trading up by 0.6%, while the BSE Small Cap index is trading up by 0.8%. The rupee is trading at 66.79 to the US$.
The minutes of Federal Open Market Committee (FOMC) meeting held last month released yesterday signaled that doors are still open for 2016 interest rate hike. This comes as The US central bank's policymakers expect that an interest rate increase will be needed soon. However, the general agreement is that more data will be looked upon before such a move becomes reality.
The minutes showed that members of the US central bank's rate setting FOMC were generally upbeat about the economic outlook and labour market. However, on the other hand, several said a slowdown in the future pace of hiring in the US would act as a hindrance for a near-term hike. Notably, several policymakers expressed concern that low interest rates could hurt financial stability.
We've written about the ill-effects of low interest rates and central bank policies often in many of our articles. Bill Bonner, in a recent article, explains what it takes to survive in an era of low interest rates. He's also written on how central bankers make us poorer. On the other hand, Asad Dossani, editor of Daily Profit Hunter, penned an article that illustrates why it's better to focus your efforts on profiting from these central banks' measures, instead of trying to explain or criticize them.
In another news update, the standard GST rate could be closer to 22% when the tax is rolled out. This is as against the widely-touted figure of 18%.
As per the sources, the current estimates being drawn out in North Block have worked out a GST rate of 22% that will likely be most amenable to states. Also, Kerala Finance Minister Thomas Isaac has said that many states would not agree to a rate below 22%.
One must note that while the GST act has been approved by most of the leading parties, the tax is far from a done deal yet. Half the states still need to approve the legislation. Along with this, the GST council, a very important part of the process, will also need to be set up. It will be the job of the Council, which will be two-thirds represented by the states, to decide on the GST rate after which three GST Bills (Central GST, Integrated GST and State GST) mentioning the actual rates will be sent to Parliament and state assemblies for approval.
Vivek Kaul, editor of Vivek Kaul's Diary, has brilliantly explained what you probably did not hear about GST from the mainstream media. He's stated all of it in a special report titled 'GST & You: What the Media DID NOT TELL YOU About the GST'.
For information on how to pick stocks that have the potential to deliver big returns, download our special report now!