Friday, May 28, 2004

Finance: Markets tank on seeing the CMP

The stock markets have not received the CMP favourably. As I write this, the markets have crashed down by close to 200 points.

The finance minister P.Chidambaram talked to the press in a hastily arranged press conference. [News on]

It appears that the markets were spooked by
  1. A call for review of Electricity Act, 2003
  2. No privatisation of profit-making PSUs
It looks like the reaction is a bit unfair, but then the stock markets have hardly been rational. If this Govt. believes in their CMP, they should press ahead and focus on growth and not bother with what the markets think. The markets will come in line anyway, once the economy continues to grow at the current pace.

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