Markets happy but small investors worry
| The reign of the United Progressive Alliance began in May 2004 in the most inauspicious way, with the Sensitive Index of the Bombay Stock Exchange greeting it with an 800-point drop. |
| This was triggered by statements made by some Left leaders, even before the government was formed. |
| How the scenario has changed. Today, the Sensex is about 10,000 points above the May 2004 level. Growing consistently at 8 per cent or more, India’s gross domestic product is among the world’s fastest growing, and has instilled confidence among investors. Foreign investors have pumped in over $27 billion in Indian equities during the UPA’s tenure. |
| Ironically, the UPA is reaping the rewards of the seeds of the economic growth planted by the previous government of the National Democratic Alliance. But it does deserve credit for keeping the India story alive. |
| However, the UPA has done little to bring in more retail or small investors except allowing the Securities & Exchange Board of India, the markets regulator, to function without interference from New Delhi. |
| The latest data from two depositories— CDSL and NSDL — suggest that the total number of demat accounts has crossed 100,00,000. |
| It is a point of concern that the share of retail investors in the overall market cap has been falling. “It was 18 per cent in 2005-06 but has fallen to 17 per cent,” said Dinesh Thakkar, the chairman and managing director of Angel Broking. |
| Adds Deven Choksey, the managing director of K R Choksey Share and Securities: “Small investors are going away from the market and moving to mutual funds. The increase in demat accounts is not enough compared to the growth.” |
| A Bill to give more powers to Sebi has been pending with the government for almost two years. Traders say the primary market in general has been buoyant over the last three years but investors’ predilection for short-term remains.<hr?</hr? |
| HIGHS |
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| LOWS
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