Foreign Portfolio Investors (FPIs) sold heavily into Indian stocks today, after the government said that it was not reconsidering the recent surcharge on the super rich. The surcharge also becomes applicable to select Foreign Portfolio Investors, who have been constantly selling since the Union Budget of 2018-19.

According to experts, a large number of FPIs in India operate through a trust or a limited liability partnership (LLP) structure that are not recognised as a corporate entity by the Income Tax Act and hence, are taxed as per the individual tax slabs based on their earnings.

The Sensex was trading with losses of 560 points, while the Nifty was down 177 points in closing trade. The losses on the indices were led by two heavyweights in HDFC and HDFC Bank. Both these stocks are known for less volatility, but, today in trade both shed as much as 2 per cent.

Auto stocks were clearly the hardest hit in trade with Tata Motors, Mahindra and Mahindra and Hero Motor Corp being the biggest losers on the Nifty. Other notable losers were Maruti Suzuki and Infosys.

Shares in RBL Bank slumped a huge 8 per cent, following its quarterly numbers. The bank saw its net Interest Income rise 47.9 percent to Rs 817.32 crore. Profit after tax rose 40.5 percent to Rs 267 crores. Despite NPAs staying stable investors were booking profits in banking stocks.

Shares in Reliance Industries ended trade in the red, ahead of its results to be declared later today.

Meanwhile, most of the Asian markets closed higher led by gains in the Japanese Nikkei. European markets surged on hopes of a rate cut in the US, while the Dow Futures pointed to higher openings.

GoodReturns.in