Mkts recover after FM balms S&P pain; Sensex down only 56 pts

Mkts recover after FM balms S&P pain; Sensex down only 56 pts
MUMBAI, Apr 25: In volatile trade, the BSE benchmark Sensex plunged nearly 190 points following S&P downgrading India’s credit rating outlook to negative, but recovered most of the losses to end the day lower by 56 points after Finance Minister Pranab Mukherjee said there is no need for panic.
The 30-share Sensex nosedived by 188 points soon after reports of S&P downgrade trickled in. It was trading at 17,019.24 while buying slowly started gathering, before ending the day at 17,151.29, showing a loss of 56 points from its previous close.
Standard and Poor’s revised its outlook on India’s long-term rating to negative from stable, citing a slowdown in investment and economic growth and a widening in the current account deficit.
Brokers, however, said Mukherjee’s comment soothed investors’ nerves. The Finance Minister in New Delhi said: “ I am concerned but I don’t feel panicky because I am confident that our economy will grow at 7 per cent, around 7 per cent if not plus. We will be able to control fiscal deficit and it will be around 5.1 per cent.”
Shanu Goel Research Analyst Bonanza Portfolio said: “Market witnessed sudden bout of selling pressure during the afternoon trade on reports of S&P downgrading the outlook to negative for India.”
Market sentiments were also weighed down by Wipro’s muted guidance. Its shares tumbled 7.03 per cent, to emerge as the biggest Sensex loser of the day, after its fourth quarter earnings showed a 7.7 per cent increase in consolidated net profit.
Brokers also said stocks may remain volatile in the immediate future as traders roll over positions from the near-month April 2012 series ahead of the derivatives expiry tomorrow. (PTI)