Sensex fizzles after rosy start

  • HT Correspondent, Hindustan Times, Mumbai
  • |
  • Updated: Mar 17, 2012 01:20 IST
  • Union finance

    Union finance Minister Pranab Mukherjee arrives at Parliament to present the budget 2012-13, in New Delhi. PTI Photo by Shahbaz Khan

  • Budget 2012-13

    Meira Kumar, P Chidambaram and LK Advani listen to Pranab Mukherjee present Budget 2012-13.

  • Industrialists

    Industrialists watching Union finance minister Pranab Mukherjee presenting the annual Budget 2012-13, on the screens at CII in New Delhi. PTI Photo by Kamal Singh

  • Union finance

    TV combo grab shows Union finance Minsiter Pranab Mukherjee  presenting General Budget 2012-13, as Speaker Meira Kumar tries to quieten  protesting members  in  Lok Sabha on ...

  • Rahul Gandhi

    TV grab shows  Congress party general secretary Rahul Gandhi  listening to the Budget speech of Union finance minister Pranab Mukherjee  in  Lok Sabha. Agencies

  • Lok Sabha members

    TV grab shows Lok Sabha members listening to the budget speech of finance minister Pranab Mukherjee in New Delhi. Agencies

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    A sniffer dog is used to secure sacks of financial papers related to the budget at the Indian Parliament hours before the Indian budget is ...

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    Workers carry sacks of financial papers related to the budget at the Indian Parliament hours before the Indian budget is presented, in New Delhi. Finance ...

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    Finance minister Pranab Mukherjee poses for the media in parliament prior to presenting the national budget in New Delhi. Government was due to deliver its budget ...

  • General Budget

    FM Pranab Mukherjee presents Budget 2012-13 as Prime Minister Manmohan Singh looks on.

A lack of incentives for attracting private sector capital investment and a fiscal deficit closer to 6% saw the benchmark 30-share Bombay Stock Exchange (BSE) Sensex erase early gains and end down 209 points, or 1.2%, at 17,466 points.


It was a session of dramatic intra-day swings for the Sensex, which gained 195 points in intra-day trade to touch a high of 17,871 before losing steam and touching a low of 17,427 points — a swing of 444 points.

"The initial positive reaction stemmed from certain proposals, such as the measures to encourage retail investment through tax sops but a high fiscal deficit figure, which means that interest rates would continue to remain high, negated the market sentiment," said Nirmal Jain, chairman and managing director, India Infoline.http://www.hindustantimes.com/Images/Popup/2012/3/17_03_12-metro7b.jpg

He also blamed the lack of detailing on attracting private sector capital inflows into the stock market as another reason for the decline in the Sensex. Only two indices — the FMCG index and the auto index which gained 1.8% and 0.2% respectively — ended in the positive zone.

According to auto analysts two percentage point increase in excise duty for passenger vehicles will not have huge ramification, even though only Mahindra & Mahindra scrip traded in the green, up 2.7% at R677, as fears of a hike in diesel passenger vehicles were belied.

"Contrary to expectations there was no additional diesel tax. It was a positive for overall industry and especially Mahindra, a diesel player," said Surjit Arora, analyst, Prabhudas Liladhar 

Adding a note of caution, CJ George, MD, Geojit BNP Paribas Financial Services, said retail investors should avoid short-term trades or intra-day trading.

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