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Indian Equities Give Thumbs Down to PM Modi's $266 Bln COVID Stimulus, Sensex Crashes 800 Points

© AP Photo / Rick RycroftA man stands in the viewing gallery at the Australian Stock Exchange in Sydney, Monday, March 9, 2020
A man stands in the viewing gallery at the Australian Stock Exchange in Sydney, Monday, March 9, 2020 - Sputnik International
New Delhi (Sputnik): India’s Prime Minister Narendra Modi announced a $266 billion stimulus package on 12 May. Finance Minister Nirmala Sitharaman announced the proposals in a series of press conferences until 17 May.

A day after India's government unveiled all the proposals contained in Prime Minister Narendra Modi's $266 billion COVID economic stimulus, Indian bourses tanked in opening trade on Monday.

The 30-share Bombay Stock Exchange's Sensex nosedived 800 points to trade at 30,297. The index marginally recovered by around a little over 100 points, to trade at 30,405. 

Banking and financial company stocks traded in red. Key Indian banks like the State Bank of India, ICICI Bank, and non-banking finance companies opened weak and fell in the opening trade. Market participants say Modi's $266 billion stimulus is not a direct stimulus, which the market was expecting. 

"This is not a fiscal stimulus. The government has facilitated collateral free mortgages across sectors along with some pending reforms, which will take time to materialise", a stock broker told Sputnik, requesting anonymity.  

The broader Nifty, having 50 shares, also lost 228 points in opening trade on Monday. India's currency lost strength against the US dollar as well in the opening trade on Monday, with the rupee slipping 30 paise to 75.88 against the dollar. 

After Modi announced the economic stimulus in the wake of COVID-19 last week, India's Finance Minister Nirmala Sitharaman held a series of five press conferences announcing the package in detail. The package includes a fillip to India's micro, small, and medium businesses in the form of government-guaranteed funding arrangements, as well as help to non-banking finance companies and the agriculture sector, among others. 

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