Market not delighted with Chidambaram's eighth Budget



Market not delighted with Chidambaram`s eighth BudgetSiddharth Tak and Ajay Vaishnav / Zee Research group

It’s a trend that finance minister Palaniappan Chidambaram won’t miss for sure: markets generally don’t respond favourably to his budgets. At least on four different occasions when Chidambaram has presented the budget, key markets indices have tumbled on the day. It’s nothing like that market is harsh towards Chidambaram.

In fact, in the last 10 years, the overarching bazaar sentiment has been more on negative side due to UPA policies. Six out of 10 budgets presented in so many years have failed to tickle the Sensex. The biggest loss was witnessed in 2009 with the Sensex closing at 5.8 percent lower on the day former finance minister Pranab Mukherjee presented his first budget under the UPA-II government. On February 28, 2013 the Sensex after opening at 19,264.80, touched an intraday high of 19,322.28 and an intraday low of 18,793.97. It finally closed the day down -1.17% at 18928.16.Exhibit 1: A comparison of the Sensex’s performance on budget days under the UPA regimes from 2004-2013


Exhibit 1: A comparison of the Sensex’s performance on budget days under the UPA regimes from 2004-2013

Previous Day  close
Budget Day
Budget Day close
Up/ down in Sensex (comparison with budget day & previous day)
%  Up/ Down in Sensex  (comparison with budget day & previous day)
4,955.97
8-Jul-04
4,843.84
-112.13
-2.26
6,569.72
28-Feb-05
6,713.86
144.14
2.19
10,282.09
28-Feb-06
10,370.24
88.15
0.86
13,478.83
28-Feb-07
12,938.09
-540.74
-4.01
17,824.48
29-Feb-08
17,578.72
-245.76
-1.38
14,913.05
6-Jul-09
14,043.40
-869.65
-5.83
16,254.20
26-Feb-10
16,429.55
175.35
1.08
17,700.91
28-Feb-11
17,823.40
122.49
0.69
17,675.85
16-Mar-12
-17,466.20
-209.65
-1.19
19,152.41
28-Feb-13

-18928.16

-224.25
-1.17

Source: - BSE