Oommen A. Ninan
MUMBAI: Stock market indices recovered smartly in late trading after Union Finance Minister Pranab Mukherjee said reviving growth momentum was the priority of the new government. Firm global markets also supported the domestic markets.
The benchmark Bombay Stock Exchange 30-share sensitive index (Sensex) gained 525.41 points at 14109.64 against its previous close of 13589.23. A broader 50-share Nifty gained 159.35 points to close at 4276.05 against 4116.05.
It was the first press conference of the newly appointed Finance Minister in the Capital on Wednesday, which gave further stimulus to markets. Mr. Mukherjee addressed the longstanding issues of the market when he affirmed that industry and business had been hurt by the cost of finance and its easy availability.
“While much has been done in the last eight months and international capital flows have resumed, the cost and the speed with which finance can be accessed remains a matter of concern”. One of the first steps Mr. Mukherjee proposed was to meet bankers and “get them committed to a more benign plan of action”.
Bank stocks moved up in tandem with Finance Minister’s proposal. Stocks of State-run banks rose on reports that they planned to cut lending rates by 100-150 basis points following a directive from the finance ministry to lower interest rates in line with falling cost of funds.
Rupee recovers 21 paise
Snapping its two-day losing streak, the rupee appreciated by 21 paise to close at 47.70/72 a dollar on Wednesday against 47.92/93 on Tuesday on expectations of heavy capital inflows.