FM says Sensex will go up soon

Finance minister Jaswant Singh today said there was nothing to worry on account of the recent fluctuations in share market as economic funda...

Finance minister Jaswant Singh today said there was nothing to worry on account of the recent fluctuations in share market as economic fundamentals were very strong even as he exuded confidence that the market will go up again. ‘‘There is no cause of panic as economic fundamentals are very strong. The sensex is undergoing a correction and it will go up again. I am confident about it,’’ Singh told Doordarshan News.

He said when the sensex crossed 6000 mark, it was said why the feel good factor is allowed to be attributed to the share market and now that sensex has gone down, the same set of people are saying that the feel good factor is diminishing.

‘‘This feel good factor is stable and strong. It is on and shall be on for a long time, no one should have any doubt about it,’’ Singh said.

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The stock market has been on a roller-coaster ride over the last few days due to heavy selling by hedge funds.

On January 23, the last trading day of last week, sensex zoomed by 223 points in unusual volatility after a three-day havoc on bourses.

As a result, the BSE benchmark 30-share index touched 5816.64 as against January 22 sensex close of 5593.74, a net rise of 222.90 points or 3.98 per cent. The rebound was unbelievable and came along with couple of coincidences such as the global rating agency Moody’s and Fitch upgrade of India’s investment grade as well as a warning by the market regulator of stringent action against players floating rumours.

Strongly denying the accusation that he was doling out largesse for electoral gains, finance minister said the revenue loss of Rs 8000-10000 crores per annum resulted by the recent duty cuts would be offset by higher collections. The series of announcements would entail a revenue loss of Rs 8000-10,000 crore per year and but this loss will be offset by higher collection due to huge increase in productivity, Singh told doordarshan news.

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He denied that he was doling out largesse from the state exchequer for electoral gains while adding the GDP growth is over 8 per cent and the economy is moving towards a record growth.

Replying to a query that he was never for populism and had even offered to quit when his partymen pressed for such measures, Singh said “my heart is the same, but political situations are never the same”.

He however clarified that the pre-budget announcments were made to give a clear signal to the people about the continued stability in the economic sector. Singh said he was not worried about the rate of inflation saying this was seasonal. “It will come down in the next few weeks”, the finance minister said.