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Markets turn negative; trade choppy

Markets turn negative; trade choppy
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First Published: Thu, Feb 25 2010. 10 45 AM IST
Updated: Thu, Feb 25 2010. 10 45 AM IST
Mumbai: Indian shares seesawed on Thursday, driven by adjustments on the last day for monthly derivatives contracts and as investors remained wary ahead of the national budget on Friday.
By 10:47am, the 30-share BSE index was down 0.3 percent at 16,207.80, with 22 of its components declining. It had started higher. The 50-share NSE index .NSEI was down 0.3% at 4,845.55.
Banks were among the losers as the market awaited a government report card on the economy around noon (0630 GMT), which should give an insight into the finance ministry’s views.
State Bank of India was down 0.6%, while smaller rivals ICICI Bank and HDFC Bank dropped 0.6% and 0.1% respectively. “People want to be light before the budget,” said Sanjeev Patkar, director of research at Almondz Global. “The key issues for the finance minister this time are fiscal deficit and GDP growth, without compromising on monetary variables.”
Finance minister Pranab Mukherjee will present the national budget for the fiscal year 2010/11 against a backdrop of strong economic rebound, which should set the stage for withdrawal of stimulus measures and fiscal consolidation.
“We see very high chance of the government being able to fulfil market expectations in the budget,” Morgan Stanley said in a note earlier this month. “We believe it will not be difficult for the government to cut fiscal deficit target for F2011, considering that pickup in growth will ensure higher tax revenues and absence of one-off expenditure items will mean lower expenditure growth.”
Auto makers were mostly lower on expectations a rollback of excise duty cuts could dampen demand. Top vehicles maker Tata Motors and leading car maker Maruti Suzuki India shed 2.2 and 0.1% respectively.
In the broader market, losers almost equalled the number of gainers on volume of 82 million shares. Trade was choppy ahead of expiry of the monthly derivatives contracts on the National Stock Exchange.
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First Published: Thu, Feb 25 2010. 10 45 AM IST
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