Dec. 15: After three days of closing in the green the markets displayed weakness and slight panic on Wednesday. Some analysts attributed it to the policy review to be announced by the RBI on Thursday, others said investors were pulling out because of the uncertainty created by the unending saga of scams. The Sensex closed down 151.42 points at 19,647.77 and the Nifty was down 51.80 points at 5,892.30.
Analysts were surprised that the markets did not react favourably to the good advance tax numbers for the October-December quarter aired on TV channels. “The markets are not prepared to consider the positives in the economy. The advance tax numbers were good, but because of the negative news of the tapes and the bribes for loans scandal, participation is missing. Corruption will be a major problem if it is not resolved,” said Mr Deven Choksey of K.R.Choksey.
There is a fear that government may put some decisions on hold and this would be dangerous, he said.
Mr Pradip Hotchandani said traditionally FIIs have not been sellers in December. The problems in the market are more domestic in nature. India like the Asian markets is going “through a risk aversion phase.”
The Asian markets have also been under performers while the US and Europe have been performing better.