US, European crisis hurting Indian markets: Pranab

August 19th, 2011 - 7:07 pm ICT by IANS  

Pranab Mukherjee New Delhi, Aug 19 (IANS) Gloom in the US and the European markets is hurting investors’ sentiments in India in the short-term, but the country is well positioned to weather the crisis in the long run, Finance Minister Pranab Mukherjee said Friday.

The finance minister reviewed the global economic situation with Reserve Bank of India Governor D. Subbarao and chairman of the Prime Minister’s Economic Advisory Council C. Rangarajan, in view of the panic selling in the Indian equities markets in the recent weeks.

“The effect of the market sentiments in the US and Europe has a bearing on our markets as well in the short-term,” Mukherjee said during the meeting.

Discussions among the key economic policy makers of the country were focused on the slow economic growth in the US and debt worries in the European countries, according to an official statement released after the meeting.

The finance minister said India’s economic fundamentals were strong and the country would “emerge stronger from the present situation.”

“As the advanced economies grapple with their problems, India is better positioned than most other nations to meet its problems,” Mukherjee said.

“India has already been upgraded to market weight by some global investment banks from underweight and this is a testimony to the strength of the Indian economy,” he added.

Mukherjee pointed out that the selling pressure in the Indian equities markets was less than the other emerging markets.

He said the benchmark indices of Indian markets declined Friday by nearly two percent as against 4-6 percent slump in other major Asian markets.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), fell 1.99 percent or 328.12 points at 16,141.67 points Friday, following a sharp drop in the US and European markets in the previous day.

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