Mumbai, July 06: The BSE benchmark Sensex on Monday
suffered the biggest fall on any Budget day and in the year
too by plunging over 869 points on the Bombay Stock Exchange
on concerns at the high fiscal deficit set by the Union
Budget.
The Sensex, which started coming down soon after the
announcement of budgetary proposals, dipped below 14,000-point
level before closing 869.65 points down at 14,043.40,
surpassing the hefty fall of 749 points on January 7.
The key index had touched the day`s low of 13,959.44 as
all the heavyweight stocks led by Reliance Industries suffered
a heavy loss 6.53 percent.
Besides the fiscal deficit, trading sentiment also
affected as European stocks dipped to a seven-week low on
worries that economic recovery might still be far way off.
The 50-share National Stock Exchange index Nifty also
tumbled by 258.55 points to 4,135.70, after hitting the day`s
low of 4,133.70.
Finance Minister Pranab Mukherjee said the fiscal deficit
may rise to 6.8 percent of gross domestic product in the year
2009-10, the highest since 1994.
Banking sector stocks suffered the most, losing 8.17 percent to 7,768.63, as ICICI Bank tumbled by 10 percent and
HDFC Bank by 5.88 percent among lenders as the Budget did not
have measures to open up the industry and on concerns that the
borrowing plan will reduce the value of bond holdings, brokers
said.
Red tomorrow too?
The stock market is likely to remain
under pressure tomorrow and may witness some selling pressure
mainly on the absence of any enthusiastic announcement in the
General Budget, analysts
said.
According to marketmen, the stock market is likely to see
weak trading sessions on Tuesday, however, they ruled out that
the possibility of benchmark indices hitting their lower
circuit limits.
"The Budget was very disappointing. The market tomorrow
will remain week but will not hit the circuit down side,"
Ashika Stock Brokers Research head Paras Bothra said.
Sensex reacted negatively: Finance Ministry
Looking at only the smaller part
of the economy, the Sensex reacted negatively on the Budget
and drove itself into a frenzy, Finance Secretary Ashok Chawla
said.
"Yes the Sensex has come down. But the Sensex quite
obviously looks at the small part of the picture. It does not
necessarily look at spending...economic opportunities in the
Budget," he said at the customary post budget-briefing here
today.
"I think the Sensex has basically driven itself into a
frenzy," he said adding that it reacted only on what concerns
the stock market.
Bureau Report
Investors lose Rs 2.54 lakh cr on Budget day
Investors lost over Rs 2.54 lakh crore on Monday as the market gave a thumbs-down to the Union Budget 2009-10, which failed to provide a
concrete road map for reducing the burgeoning fiscal deficit.
The total investors` wealth, measured in terms of combined market capitalisation of all the listed companies, declined by over Rs 2,54,153 crore at the end of trade today to Rs 46,23,304.34 crore.
The total market capitalisation of all listed entities was at Rs 48,77,457.38 crore at the end of Friday last.
Analysts believe the Budget fell short of high market expectations as it did not make clear how it would push forward with the divestment plans.
The government today said the fiscal deficit for the financial year ending March 2010 would increase to 6.8 percent of GDP from 6.2 percent in the previous year.
The 30-share Bombay Stock Exchange Sensex nosedived by 869.65 points at 14,043.40, after witnessing a low of 13,959, down 952 points.
Further, the 30-Sensex companies, which account for over 46 per cent of the total market capitalisation of all the companies, saw their combined market valuation declined by over Rs 1.23 lakh crore today.
The combined market capitalisation of the 30-blue chip stocks fell to Rs 21,13,970.97 crore today from Rs 22,37,570.19 crore at the end of trade on Friday.
Among the Sensex companies, Reliance Infrastructure was the biggest loser as it plunged 12.47 percent, followed by ICICI Bank 10.09 percent.
Other major index-wise losers include Jaiprakash Associates, Tata Steel, HDFC and Larsen & Toubro, which fell between 9 percent and 10 per cent.
At the end of trade today, Reliance Industries remained the most-valued firm in the country with a market capitalisation of Rs 2,98,018 crore, followed by ONGC at Rs 2,28,933.95 crore, NTPC (Rs 1,59,961.92 crore), MMTC (Rs 1,49,686.75 crore) and Bharti Airtel (Rs 1,48,756.27 crore).
Bureau Report
