Mumbai/ New Delhi, Oct 13 : The Bombay Stock Exchange (BSE) Sensex extended its gains to seven percent on Monday afternoon, boosted by the Finance Minister P. Chidambaram saying that the government was working on more measures to improve liquidity.
The rise, which is set to end a five-day losing streak, was underpinned by gains elsewhere in Asia after policymakers and regulators around the world took a slew of measures to shore up the battered financial system.
Chidambaram said that the government, the central bank and the stock market regulator were coordinating on an hourly basis regarding the fallout of the global financial crisis on the Indian market.
Chidambaram expressed hope that Indian markets will also take a cue from the positive developments of the international markets and perform well.
"Over the weekend, the US, UK, Euro zone and Australian authorities have announced a number of measures to stabilize the financial system. The Australian capital market and three of the East Asian capital markets have opened on a bright note this morning. I expect that our capital market will also take its cue from these positive developments," he said.
The rise in the stock market also brought some relief to the investors, though analysts remained skeptical over the stability in the market.
"The government is taking measures. It's a plus point. For that reason, the market will not go down, but for that reason, the market will not go up. We can't say that bear phase is gone and only bull phase is there and now the market will keep on going up. Foremost thing is the corporate result, which are going to come out in next two-three weeks," said Sharad Gadodia, Market Analyst.
Global equity markets were gutted last week, and investors even liquidated positions in safe havens like government bonds for cash, on dwindling hopes that anything could be done to keep the global economy from sliding into recession.
The investors said that they were not convinced the correction in markets had ended and preferred to stay on the sidelines till global markets stabilised.
"We are connected with global market and we cannot say anything. What is the damage done. That's why it is very difficult to say. But at least next six months or one year, there are no chances of any upward trend. It may stabilize after one month or after 15 days or after two months, but at present it is most volatile," said S.J. Modi, an investor.