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Markets sink, Sensex crashes to 3326.98 as govt loses trust vote; Congress seeks vote on account, to pass Sinha's Budget

The Bombay Stock Exchange's 30-share benchmark index, the Sensex, closed at 3326.98, down 246 points from yesterday's close of 3572. Early morning, it rose to 3710 level on reports that the Vajpayee government will win the vote of confidence in the Lok Sabha.

As soon as news filtered in that the government lost the vote by a wafer-thin margin of one (269 for, 270 against), the stocks markets started sinking. In a matter of ten minutes, the Sensex plunged 150 points, from 3500 to 3350.

However, within minutes, there were reports that leader of the Opposition, Sharad Pawar (Congress) has announced his party will form the government. This seems to have checked the Sensex plunge.

There was across-the-board selling pressure and almost all the scrips hit the lower limit of their respective circuit-breakers.

With the Vajpayee government's resignation imminent, the Rajya Sabha member Kapil Sibal of the Congress indicated that his party will ask for a vote on account, and the next finance minister will present an alternate Budget in three months. Yashwant Sinha's Budget, he said, will not be adopted.

But later in the evening, after Vajpayee had put in his papers, senior Congress politician and former Union minister Kamal Nath said in a televised discussion that the party would get the Budget passed with some amendments, especially relating to the tax rebates proposed for the Bajrang Dal and the Vishwa Hindu Parishad.

Industry urges politicians to save Sinha's Budget

Budget 1999-2000

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