Market fell on account of FII selling; fundamentals strong: FM

New Delhi, Feb 2 (PTI) Attributing the fall in stockmarkets in the past few days to selling by FIIs, FinanceMinister Pranab Mukherjee today asserted that the fundamentalsare strong and the economy will clock 8.5 per cent growth inthe current financial year.

The volatility in stock market has been on account of"continued selling by FIIs," he said, adding the Indianeconomy has "strong fundamentals".

"While the stock market has its own mind and it take cuesfrom developments all around, I want to take this opportunityto retreat the strong fundamentals of the Indian economy,"Mukherjee told reporters here.

The benchmark index Sensex of the Bombay Stock Exchangehad lost 5.90 per cent in the past five trading sessions withinvestors resorting to hectic selling in wake of Egypt crisisand high inflation etc.

The markets, however, recovered today gaining 68 pointsto close at 18,090.62 points.

The government, Mukherjee said, would stick to the growthprojection of 8.5 per cent for the current fiscal. Theeconomy expanded by 8 per cent during 2009-10 and recorded 8.9per cent growth rate in the first half of the current fiscal.

"I am confident that we will meet our growth projectionfor the year...(2010-11) will end with a better than projectedfiscal balance and more moderate inflation," Mukherjee added.

While the price rise had been a problem for thegovernment after the food inflation soared to 18.32 per centfor the week ended December 25, the fiscal deficit is likelyto moderate on the back of higher revenue growth and betterthe anticipated realisation of funds from sale of 3G spectrumto telecom companies.

"There has been fluctuations (in inflation). At onepoint of time, food inflation went as high as 18.32 per cent.

In the large economy like India, these kinds of periodicfluctuation''s are not unusual," he said.

In the remaining three months, the Minister added, "theremay be some fluctuations". .

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