Encouraged by about 400 points upsurge in the BSE sensex in the opening trade, Finance Minister Pranab Mukherjee on Wednesday exuded confidence that markets will stabilise in the next few days.
He also said the government and the Reserve Bank will work in close cooperation to bring stability besides ensuring adequate liquidity in the forex market.
“One thing is certain that confidence has come back in respect of Indian markets ... There has been a slow recovery and in couple of days it will be stable,” Mr. Mukherjee told reporters here.
Snapping its six-session losing streak, the Bombay Stock Exchange benchmark Sensex made a strong comeback by rising nearly 400 points in opening trade, supported by a rebound on other Asian bourses.
The 30-share BSE barometer, which has lost nearly 1,455 points in the past six sessions and had hit a 14-month-low, rose by 398.55 points to 17,256.46 as stocks moved into positive terrain with gains of up to 2.96 per cent in morning trade.
On steps to deal with the financial crisis triggered by downgrading of the U.S. sovereign rating by Standard and Poor’s, Mr. Mukherjee said, “both RBI and Ministry of Finance are working together in close cooperation to ensure that whatever steps are needed,... (are) taken. There will be no dearth of liquidity of forex”.
As regards the fallout of the U.S. Federal Reserve’s decision to keep the interest rates at near zero level for two years, the Minister said, “it will have some impact” on the Indian markets which are in the process of stabilisation after witnessing huge decline.