Almost a fortnight after the commencement of the Goods and Services tax, the stock market indicates its responses by a displeasing turn of events….
Breaking odds and defying tradition, the GST continues to be of the prime essence in the present day market. The stock market seems to be the most bamboozling place for such an economic turnover. With multiple share prices varying from their conventional values, the tax method has startled every investor in the town. Just how exactly the GST disturbs the stock market in 5 ways-
1.Harming your dividends
With increased tax returns companies continue to battle the hefty prices. In order to meet the expenses majority of the corporations have increased their fixed pricing marks, leading to hefty pricing in the market. This is causing the investors to suffer on their fair share of dividends. Short term loss scenarios have become frequent indicating to avoid unnecessary budget splitting.
Splitting your component shares at this time seems to be a bad idea. Multiple MNCs have seen different taxes being levied on their goods as a result of the diverse nature of their shares. This way the companies are trying to compensate the losses at the hands of the investors.
3.Tearing up the Positional Concept
With each individual being taxed at greater prices, in some way or the other, the investors fail to apply the positioning method. Buying out the whole stock seems to be the newly picked up trend which is a direct cause of the positioning concept elimination. Conventional trading patterns consisting of short positioning and borrowing collateral seems to have taken their toll on the market investors.
Eliminating market competition brings out a smile on the faces of investors, but not for the market battlefield. With multiple rates resulting in losses, a number of freelancing individuals and reputed investors are releasing their assets and liquidating their stocks. In short, going home.
5.Bringing down the decision making
Of all the important factors, the market is testing its preachers in the current scenario. Questioning their problem solving skills, multiple partners are sitting with various stocks in order to secure their assets. Less intense activity is witnessed along with meticulous moves.
With the advent of the GST era, the market keeps on unraveling new surprises. Trusting the economic foundation of the subcontinent is an apocryphal idea at this stage.