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Sensex continues 14-year tradition, falls on Budget day 2014 as well

Thursday, 10 July 2014 - 7:30pm IST | Agency: Zee Research Group

In the last 14 years, the stock market has put up a disappointing show on the day of Budget. Of the 14 instances, the Sensex tumbled on eight different occasions.

A Zee Research Group (ZRG) analysis of the market performance on the day of Budget announcement in the past 14 years showed that the Bombay Stock Exchange (BSE) index, Sensex, had been in the positive territory on just six occasions.

ZRG has incorporated those budgets which have been announced at 11.00 am. Till the year 2000, the Union budget was announced at 5.00 pm, but Yashwant Sinha began a new trend by announcing it at 11.00 am in 2001.

During the period under review, a maximum six budgets have been presented by Chidambaram followed by Pranab Mukherjee (4), Yashwant Sinha (2), Jaswant Singh (1), and Arun Jaitley (1).

Out of the six instances when Chidambaram has presented the budget, key markets indices have tumbled on four different occasions. The Sensex had registered a maximum fall of 4% under his regime.

It’s nothing like that market is harsh towards Chidambaram. The biggest loss was witnessed in 2009 with the Sensex closing at 5.8% lower on the day former finance minister Pranab Mukherjee presented his first budget under the UPA-II government.

Similarly, the years when the market saw a decline on the Budget day were, 2013 (down 1.5%), 2012 (1.2%), 2008 (1.4%), 2007 (4%), 2004 (2.3%), 2002 (3.9%).

Likewise, on July 10, 2014, when Arun Jaitley has presented his first budget, Sensex closed the day down 0.28% at 25,372.75.

S.No.

Finance Minister

Sensex closing on previous day

Budget Day

Sensex closing on the Budget day

%  Up/Down in Sensex  (comparison with budget day & previous day)

1

Yashwant Sinha

4,069.68

28-Feb-01

4,247.04

4.4%

2

Yashwant Sinha

3,705.66

28-Feb-02

3,562.31

-3.9%

3

Jaswant Singh

3,277.34

28-Feb-03

3,283.66

0.2%

4

P Chidambaram

4,955.97

8-Jul-04

4,843.84

-2.3%

5

P Chidambaram

6,569.72

28-Feb-05

6,713.86

2.2%

6

P Chidambaram

10,282.09

28-Feb-06

10,370.24

0.9%

7

P Chidambaram

13,478.83

28-Feb-07

12,938.09

-4.0%

8

P Chidambaram

17,824.48

29-Feb-08

17,578.72

-1.4%

9

Pranab Mukherjee

14,913.05

6-Jul-09

14,043.40

-5.8%

10

Pranab Mukherjee

16,254.20

26-Feb-10

16,429.55

1.1%

11

Pranab Mukherjee

17,700.91

28-Feb-11

17,823.40

0.7%

12

Pranab Mukherjee

17,675.85

16-Mar-12

17,466.20

-1.2%

13

P Chidambaram

19,152.41

28-Feb-13

18,861.54

-1.5%

14

Arun Jaitley

25,444.81

10-Jul-14

25,372.75

-0.28%

Source: BSE; Please note Interim Budgets are not considered for the analysis


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