SEBI probing reasons behind stock market crash Tuesday, May 25 2004 16:47 Hrs (IST)
New Delhi:
The Securities and Exchange Board of India (SEBI) today (May 25, 2004) said it was analysing data to find out the reasons behind last week's stock market crash and a report would be submitted to the new Government after the probe was completed.
SEBI chairman G N Bajpai, who called on the new Finance Minister P Chidambaram in New Delhi today, had a 30-minute-long meeting to brief him about the markets.
"We are yet to analyse the data. It will be too premature to say anything now," Bajpai said, when asked whether markets were manipulated after the Lok Sabha poll results were out.
He declined to give a time frame within which the market regulator would complete the probe and submit a report.
SEBI will submit a report "as and when data is analysed", Bajpai said.
The SEBI chief, however, sought to allay fears of any crisis in the market saying "there is no payment crisis. Our markets are one of the safest in the world."
Bajpai declined to give details of the meeting saying it was a "courtesy call" as SEBI was a functionary under the Finance Ministry.
The meeting assumes importance in the wake of sharp fall in share prices in the last week that had wiped off more than Rs 1,00,000 crore of shareholders wealth.
Yesterday, Chidambaram said that the SEBI was looking into the reasons behind the market crash and would continue its probe even after the markets have cooled down.
Soon after the Lok Sabha election results were out, stock markets fell sharply as investors feared a reversal of reform and disinvestment process during the regime of the new
Congress-led Government.
On May 18, the BSE Sensex crashed by over 880 points but closed more than 560 points lower, the biggest fall in a day in the history of Indian capital market.
Trading had to be suspended twice on that day as investors offloaded stocks in panic.
Government asked SEBI to look into the matter to find out whether there was any cae of market manipulation by a section of investors.
The markets, however, propped up after the new United Progressive Alliance appointed Manmohan Singh as the Prime Minister and P Chidambaram as the Finance Minister.
