The Hindu Business Line : Moods swing for B-day brokers

"WE only hope that even if the Finance Minister does not do much good, he will not do much to harm the markets," said a broker on his way to his office at the BSE on Budget Day.

This sense of uncertainty hung over the bourses during Mr P. Chidambaram's Budget speech, with the indices hovering within a range for all of the 120 minutes.

As various initiatives for the rural and agricultural sector were announced, brokers tried to fix benefits to stocks. "Nothing too exciting this time. The shadow of the Common Minimum Programme seems to be haunting this Budget," commented a trader.

In the dealing room, all the senses were on full alert. Eyes darted between the TV screen and terminals. Announcements were welcomed with cheers or loud groans.

Sporadically, depending on the announcement, some sectors saw excitement. Construction and cement stocks were hunted down and orders logged as the Bharat Nirman initiatives were announced. When the sop on re-plantation for tea planters was announced, the Tata Tea and Harrison Malayalam scrips began to ride the way. "If it sounds good, we'll buy it in small lots. Buy or sell decisions during the Budget cannot be based on heavy analysis, so we will go with gut feel," said a dealer at the BSE.

Expectations on the textile sector seemed well founded as various measures were announced to benefit the sector. Brokers who had taken positions on the sector over the last few days breathed a collective sigh of relief.

The mood in brokerages, however, continued to be tepid with anticipation that news — good or bad — was just around the corner.

Though the Finance Minister introduced the importance of the capital market in weighty terms, there was disappointment over the real initiatives announced.

The announcement that SEBI had been authorised to set up a National Institute of Securities Markets for teaching and training intermediaries in the securities markets and promoting research was met with derision. Dealers joked about getting their Ph.Ds. from the market regulator.

The markets have been dreading an across-the-board increase in securities transaction tax. Relief was apparent after Mr Chidambaram announced that the increase in STT was merely by 0.005 per cent for non-delivery-based transactions.

The real party at the bourses started after the speech was over. On affirmation that nothing "highly worrisome" was announced, markets buoyed to all-time highs. "It looks like we've got steam ahead and are comfortably headed to the new target of 7000-7200 on the Sensex. Let's give it a couple of days and then we'll know for sure," said Mr Ramesh Damani, Member, BSE.

The bulls are rocking, for now.

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