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Budget disappoints Sensex; falls 870 pts
Published on 7 Jul. 2009 12:50 AM IST
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The BSE benchmark Sensex suffered the biggest fall on any Budget day and in the year by plunging over 869 points on the Bombay Stock Exchange on concerns over the high fiscal deficit set by the Union Budget. The Sensex, which started coming down soon after the announcement of budgetary proposals, dipped below 14,000-point level before closing 869.65 points down at 14,043.40, surpassing the hefty fall of 749 points on January 7. The key index had touched the day’s low of 13,959.44 as all the heavyweight stocks led by Reliance Industries suffered a heavy loss 6.53%. Besides the fiscal deficit, trading sentiment also affected as European stocks dipped to a seven-week low on worries that economic recovery might still be far way off. The 50-share National Stock Exchange index Nifty also tumbled by 258.55 points to 4,135.70, after hitting the day’s low of 4,133.70. Finance minister Pranab Mukherjee said the fiscal deficit may rise to 6.8% of gross domestic product in the year 2009-10, the highest since 1994. Banking sector stocks suffered the most, losing 8.17% to 7,768.63, as ICICI Bank tumbled by 10% and HDFC Bank by 5.88% among lenders as the Budget did not have measures to open up the industry and on concerns that the borrowing plan will reduce the value of bond holdings, brokers said.

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