Market crash just a correction: FM
"It's a correction. It's nothing," FM says reacting to the 217 pts fall in Sensex, the steepest since Sept 22, 2005.india Updated: Mar 09, 2006 17:25 IST
Unperturbed by the 217 points fall in Sensex, Finance Minister P Chidambaram said on Wednesday that it was nothing but a "correction."
"It's a correction. It's nothing," he told reporters reacting to the benchmark index's 217 points fall to 10,508.85, the steepest since September 22, 2005.
After heavy withdrawals of Rs 1,488 crore in the Nifty futures and Rs 395 crore in stocks futures by FIIs, investors frantically sold shares across the board bringing down the Sensex.
While dismissing any cause for worry in the capital market, Chidambaram expects huge advance tax payments by corporates in the coming days and a liquidity crunch in the banking system.
"Liquidity will be tight as there will be a huge amount of advance tax payments (by corporates) in March," he said, adding that government had privately placed bonds worth Rs 10,000 crore with RBI on Monday.
The Finance Minister said states should spend more to ease liquidity in the system. "States are sitting on huge cash surplus of over Rs 50,000 crore. They should spend."