ID :
45956
Tue, 02/17/2009 - 07:09
Auther :
Shortlink :
http://m.oananews.org//node/45956
The shortlink copeid
Lacklustre Budget pulls down mkts, Sensex tanks 329 pts
Mumbai, Feb 16 (PTI) The Indian stock markets, which were
on a high on anticipation of stimulating measures for the
industry and some tweaking in tax structure, Monday tanked
with the benchmark Sensex on Bombay Stock Exchange (BSE)
nosediving by 320 points as the interim Budget turned out to
be a damp squib.
With investors exercising caution, the markets opened
weak before the presentation of interim Budget by India's
Finance Minister Pranab Mukherjee at 1100 hours in Parliament.
As Mukherjee, who holds the portfolio of finance
minister, went on reading out the Budget papers on Parliament
the Sensex plunged into deeper red as the Budget fell short of
the investor expectations.
Besides a lacklustre Budget, sluggish Asian markets also
contributed to across-the-board selling pressure. The BSE
barometer finally closed the day at 9305.45 points, lower by
329.29 points, the biggest drop since February 2.
Realty stocks, which bucking the trend surged in early
trade on anticipation of emphasis on real estate and
hospitality sectors in the interim Budget, however ended the
day with heavy losses.
As the interim Budget fell short of market expectations,
selling pressure gained momentum and spread across the wide
front which saw all sectoral indices ending in the red.
"Euphoria was built up in the market last week ... but
the government took a conservative approach, and has presented
an interim statement. It did not want to expand its fiscal
deficit by announcing any further fiscal stimulus," SMC Global
Vice-President Rajesh Jain said.
External Affairs Minister Pranab Mukherjee, who holds the
charge of finance ministry, presented the interim Budget that
made no change in direct and indirect taxes or unveil any
stimulating measures for the industry as was widely expected.
On other hand, brokers said investors are concerned over
the rising fiscal deficit which has been revised at 6 percent
of theGross Domestic Product (GDP) against 2.5 percent in
Budget estimate. Revenue deficit also placed at 4.4 percent
against 1 percent in the estimate for 2008-09 augmented their
concerns, they added.
"We term the budget a disaster; instead of bringing
cheers for (the) common man, they have rather exercised
caution saying that the next government will have to live with
a high fiscal deficit," Arun Kejriwal, director, Kejriwal
Research and Investment Services, said.
With a "disastrous" budget offering nothing for the
industry, metal, realty, banking, capital goods, refinery and
power sectors suffered heavy losses in range of over 4percent.
RIL led the fall and closed lower by 3.42 percent.
Blue-chip ICICI Bank was another big loser at 5.79 percent.
Jaiprakash Asso at 7.88 percent and Rel Infra at 6.35 per
cent were other major losers among the elite club.
Metal stocks index took a heavy beating as the sectoral
shares, particularly Tata Steel, were battered. The BSE metal
stock index at 4.75 percent was the biggest loser among all
indices Monday.
Citing the reason for heavy fall in metal stocks Taurus
Mutual Fund Managing Director R K Gupta said, "Market was
expecting imposition of additional duty on steel imports which
did not happen and sector went down."
Realty stocks were next biggest loser with their sectoral
index losing 4.58 percent after the interim budget dashed
hopes of any sops for the sector.
Experts said the the budget belied investor expectation
of policy changes in the interest-rate sensitive sector
"The government has not announced anything specific for
interest rate sensitive sectors as it has left room for RBI to
take corrective measures. I will not be surprise if the RBI
comes out with rate cut by this week-end," Taurus's Gupta
said.
Shares of another interest rate sensitive sector banking
were also battered as the government had not only no major
policy decision in the budget but on the other hand indicated
that the cost of borrowing might go up.
"With bond yields hardening, fund raising by banks would
become costlier. This is the major negative news for the
banks," Ashika Stock Brokers Research Head Paras Bothra said.
Brokers said they expected the market to remain range
bound with downward bias for couple of weeks.
The total market breadth turned sharply negative with
1,598 losers against only 776 gainers on the BSE at close.
The trading volume dipped to Rs 2,908.21 crore from Rs
3,103.17 crore on Friday. RIL topped the list of highest
traded share with the turnover of Rs 239.94 crore.
The BSE-100 index also plunged by 167.89 points or 3.43
per cent to 4,732.85 from 4,900.74 previously. PTI TEAM
RAI
on a high on anticipation of stimulating measures for the
industry and some tweaking in tax structure, Monday tanked
with the benchmark Sensex on Bombay Stock Exchange (BSE)
nosediving by 320 points as the interim Budget turned out to
be a damp squib.
With investors exercising caution, the markets opened
weak before the presentation of interim Budget by India's
Finance Minister Pranab Mukherjee at 1100 hours in Parliament.
As Mukherjee, who holds the portfolio of finance
minister, went on reading out the Budget papers on Parliament
the Sensex plunged into deeper red as the Budget fell short of
the investor expectations.
Besides a lacklustre Budget, sluggish Asian markets also
contributed to across-the-board selling pressure. The BSE
barometer finally closed the day at 9305.45 points, lower by
329.29 points, the biggest drop since February 2.
Realty stocks, which bucking the trend surged in early
trade on anticipation of emphasis on real estate and
hospitality sectors in the interim Budget, however ended the
day with heavy losses.
As the interim Budget fell short of market expectations,
selling pressure gained momentum and spread across the wide
front which saw all sectoral indices ending in the red.
"Euphoria was built up in the market last week ... but
the government took a conservative approach, and has presented
an interim statement. It did not want to expand its fiscal
deficit by announcing any further fiscal stimulus," SMC Global
Vice-President Rajesh Jain said.
External Affairs Minister Pranab Mukherjee, who holds the
charge of finance ministry, presented the interim Budget that
made no change in direct and indirect taxes or unveil any
stimulating measures for the industry as was widely expected.
On other hand, brokers said investors are concerned over
the rising fiscal deficit which has been revised at 6 percent
of theGross Domestic Product (GDP) against 2.5 percent in
Budget estimate. Revenue deficit also placed at 4.4 percent
against 1 percent in the estimate for 2008-09 augmented their
concerns, they added.
"We term the budget a disaster; instead of bringing
cheers for (the) common man, they have rather exercised
caution saying that the next government will have to live with
a high fiscal deficit," Arun Kejriwal, director, Kejriwal
Research and Investment Services, said.
With a "disastrous" budget offering nothing for the
industry, metal, realty, banking, capital goods, refinery and
power sectors suffered heavy losses in range of over 4percent.
RIL led the fall and closed lower by 3.42 percent.
Blue-chip ICICI Bank was another big loser at 5.79 percent.
Jaiprakash Asso at 7.88 percent and Rel Infra at 6.35 per
cent were other major losers among the elite club.
Metal stocks index took a heavy beating as the sectoral
shares, particularly Tata Steel, were battered. The BSE metal
stock index at 4.75 percent was the biggest loser among all
indices Monday.
Citing the reason for heavy fall in metal stocks Taurus
Mutual Fund Managing Director R K Gupta said, "Market was
expecting imposition of additional duty on steel imports which
did not happen and sector went down."
Realty stocks were next biggest loser with their sectoral
index losing 4.58 percent after the interim budget dashed
hopes of any sops for the sector.
Experts said the the budget belied investor expectation
of policy changes in the interest-rate sensitive sector
"The government has not announced anything specific for
interest rate sensitive sectors as it has left room for RBI to
take corrective measures. I will not be surprise if the RBI
comes out with rate cut by this week-end," Taurus's Gupta
said.
Shares of another interest rate sensitive sector banking
were also battered as the government had not only no major
policy decision in the budget but on the other hand indicated
that the cost of borrowing might go up.
"With bond yields hardening, fund raising by banks would
become costlier. This is the major negative news for the
banks," Ashika Stock Brokers Research Head Paras Bothra said.
Brokers said they expected the market to remain range
bound with downward bias for couple of weeks.
The total market breadth turned sharply negative with
1,598 losers against only 776 gainers on the BSE at close.
The trading volume dipped to Rs 2,908.21 crore from Rs
3,103.17 crore on Friday. RIL topped the list of highest
traded share with the turnover of Rs 239.94 crore.
The BSE-100 index also plunged by 167.89 points or 3.43
per cent to 4,732.85 from 4,900.74 previously. PTI TEAM
RAI
