Shome panel's GAAR (General Anti-Avoidance Rules) recommendation failed to cheer stock markets as investors are currently more concerned about disappointing GDP growth, policy inaction and political turbulence.

An expert panel, headed by tax expert Parthasarathi Shome, and appointed by Prime Minister Manmohan Singh to review the provisions of the GAAR recently recommended deferring of a set of controversial tax avoidance rules by three years. It was being believed that the postponement would please investors, particularly foreign institutional investors.

But, benchmark indices on Monday closed slightly lower than a one-month low. The Nifty closed almost unchanged at 5,253.75, while the Sensex slipped 0.3 per cent to 17,384.40 on Monday.

Nirmal Jain, chairman of India Infoline, said that markets did not react to the Shome panel’s recommendations because the optimism surrounding the postponement of the GAAR rules were outshined by problems in the macro economy.

Speaking on the topic, Mr. Jain said, “Now, markets are confronted with and more concerned about dismal GDP numbers, multicrore scams and whether anything will be done to stimulate the economy.”

Both Nifty and Sensex gained over the last couple of months as investors had been in anticipation of some government measures for the revival of economy.