Markets recede when the Economic Survey fuels fears of fiscal slippage; all eyes on Budget
MUMBAI: The sensex slipped 190 points, while the Nifty closed below the 12,000 mark on Friday after the suggested relaxed fiscal deficit target to boost growth from a low decade.
The markets opened on a firm basis, but were under selling pressure in the afternoon trade, coinciding with the opening of the Parliament Budget session and the presentation of the Economic Survey.
The 30 shared BSE sensex closed 190.33 points, or 0.47 percent, lower at 40,723.49. Also, the broader NIF NSE lost 73.70 points, or 0.61 percent, to finish at 11,962.10.
The Economic Survey projected the revival of economic growth to 6-6.5 percent in the next fiscal year of the estimated 5 percent in 2019-20. However, he recommended relaxing the budget deficit target to boost growth.
The operators said that the prospects for greater government indebtedness and the displacement of private sector investment scared market participants, which led to the dissolution of positions.
ONGC was the main laggard in the sensex package, with a drop of 5.80 percent, followed by PowerGrid, HCL Tech, TCS, Tata Steel and Reliance Industries.
The Kotak Mahindra Bank was the main winner, with an increase of 3.87 percent, after the lender resolved its dispute with RBI about the participation of promoter Uday Kotak.
The SBI increased 2.53 percent after the country's largest lender reported a 41 percent jump in net earnings to Rs 6,797.25 rupees for the December quarter.
Other winners included IndusInd Bank, Bharti Airtel, Bajaj Auto and Hero MotoCorp.
The focus now shifts to the Union Budget, which will be presented by finance minister Nirmala Sitharaman on Saturday. Markets will remain open on budget day.
Investors stayed away from taking new positions before the big event. The focus will be on Union Budget as all eyes will be on how the Center will bring growth since any increase in spending would result in an expansion of the fiscal deficit.
The global economy is also on the verge of significantly growing fears of slow growth after the outbreak of the virus, said Vinod Nair, head of research at Geojit Financial Services.
Sectorially, the BSE indexes of oil and gas, energy, metal, public services, energy, basic materials, IT and automobiles fell to 2.65 percent.
Telecommunications, real estate, consumer durables, bankex and finance rose to 1.23 percent.
The broader indices of BSE midcap and smallcap ended in red.
On the global front, sentiment remained weak as investors assessed the impact of the coronavirus outbreak in China.
The death toll in China's coronavirus epidemic rose to 213 and total infections reached 9,692, the Chinese government said on Friday when the World Health Organization (WHO) declared the outbreak that has spread to more than a dozen of countries, including India, as a global health problem. emergency.
The courses in Hong Kong and South Korea ended in red, while Japan increased by 1 percent. The markets in China remained closed.
The European stock exchanges opened with a negative note.
Brent crude oil futures rose 0.38 percent to $ 57.55 per barrel.
Meanwhile, the Indian rupee appreciated 23 countries at 71.35 per US dollar (intraday).