Banerjee said that she has sought time to meet Prime Minister Narendra Modi regarding the issue.
Stocks of government controlled public sector banks led by State Bank of India increased their cumulative gains today ~ a day before the Modi government presents its annual Budget of its second term ~ as market participants appeared optimistic that these lenders would continue to receive capital infusion for at least three more years and become vehicle of credit growth for retail as well as corporate borrowers.
The optimism is based on the government’s resolve as reflected in the pre-Budget economic survey released today to revive capex cycle in private sector in particular. The India Inc capex has been dormant for a larger part during Prime Minister Narendra Modi’s first five-year term, point out analysts. Analysts do not rule out the government’s intention to drive economic growth even if it comes at the cost of a rise in fiscal deficit. Dalal Street participants also see fresh policy initiatives by the government to bring economic growth back on track by promoting investment in infrastructure and consumption sectors for which it appears the government has cut out the task for state-run lenders. Private sector banks have always been better performing as they recovered from the trauma of non-performing loans faster than their PSB peers. This, analysts pointed out, was confirmed by the earnings data for last two to three quarters. Besides, two main private sector banks ICICI Bank and Axis Bank, deftly tackled three governance issues by installing new professional bankers at their respective helms. Comparatively, the chances in the finances and administration in state-run banks has been slow or gradual, say analysts.
Therefore, expecting a boost to PSBs coupled with financial stimulus to propel economic growth, investors today largely welcomed the economic survey for claiming that the new investment cycle is set to roll out. The survey also credited its positive projections on the political stability ensured by a singleparty majority government at the Centre. Brokerages, domestic as well as off-shore, also have been waiting for political stability.
Many veteran brokers in Dalal Street say the domestic slowdown could also be on account of three-month long concern over possible political uncertainty in the run-up to the general election, which is now out of the way. They now are heavily depending on tomorrow’s Budget which if fulfils the market’s hopes and aspiration could also prove the biggest trigger for the 30- scrip Sensitive Index of Bombay Stock Exchange and 50- share Nifty of National Stock Exchange in 2019, say analysts. The benchmarks today held on to their intra-day gains amid subdued volatility which analysts attributed to optimistic guidance spelt out by the government’s chief economic adviser K Subramanian.
The Sensex ended at 39,908.06 (+68.81) points rising 0.17 per cent with 19 stocks moving up and 11 down. Nifty at 11,946.75 (+30.00) points was 0.25 per cent up as 31 shares ended up and 11 down. Nifty PSU Bank settled at 3,297.30 (+41.65) points increasing 1.28 per cent. The top gainers in Sensex included Bharti Airtel at Rs 362.35, up 2.53 per cent and Kotak Mahindra Bank at Rs 1,496.25, up 1.46 per cent.