Mumbai, Mar 1 () : Stock markets reacted negatively to the Budget 2013 with the BSE Sensex dropping 291 points to go below 19,000-level, a scenario that was last seen in June 2009.
The investors in domestic and foreign sectors started selling. The taxes on companies scared the local sentiment while budget brought in a clause that mere residency certificate from Mauritius was not sufficient to claim tax exemption for FII ,spooked the investors.
Yesterday, the stock markets reacted positively in the morning trade and reached a high of 170 points touching 19,332.28. As the budget stated unfolding, the stocks started swinging as announcements of taxes on companies as well as super-rich were made with no sops for large investors. The slide started to close at 1,861.54 with 290.87 points dropped, the lowest close after November 2012.
Markets going by previous record reacted negatively on claim of Government to mop up funds from PSU disinvestment and spectrum sale to make up for the fiscal deficit. The shocker coming in the budget scared FII on the residency certificate and brought back the ghost of GAAR.
Finance Minister P Chidambaram, however said, the government has not burdened the people or scared investors, while stating that he will definitely contain the deficit.
The budget target for gross market led to SBI, HDFC and ICICI Bank stocks falling, auto companies dropped after hike in excise , infra structure companies RIL, L&T, Tata Steel and BHEL also hit a low.
Despite excise hike on cigarettes, ITC however recouped to be steady. Consumer goods companies and IT stocks like TCS gained but those that had to do with infrastructure took a beating with 300 odd stocks closing in the end.
In the domestic market, of 30 stocks, around 24 closed in the red. PSU, banks, steel and power scrip were those that closed in the red.