Indian Stock Markets See Volatility Amid Tax Hopes and IT Rally

Indian benchmark indices closed sharply lower on Monday, with the Sensex declining 0.76 per cent and the Nifty falling 0.70 per cent. Markets staged a strong recovery on Tuesday, with the Nifty 50 gaining 1.60 per cent, driven by optimism around corporate earnings and a rally in information technology stocks. On Wednesday, indices opened lower but recovered, supported by hopes of relief on Long-Term Capital Gains tax and Securities Transaction Tax.

The market sentiment is influenced by expectations that the government may review stakeholder feedback on the Long-Term Capital Gains tax and the Securities Transaction Tax. The recovery on Tuesday was particularly led by the Nifty IT index, which jumped more than 5 per cent, indicating investor positioning around earnings visibility.