Indian investors were caught by surprise at the appointment of Nirmala Sitharaman as the Finance Minister on Friday. Sitharaman will also head the Corporate Affairs Ministry.
Dalal Street was expecting the Finance portfolio to go to either Amit Shah, who has been given charge of the Home Ministry, or to Piyush Goyal, who has retained Railways and additionally has the Commerce portfolio.
At 1.18 p.m. on Friday, the S&P BSE Sensex was trading at 39,726.44 after it had crossed the 40,000-mark during the early trade. The Nifty also slipped to 11,927.50 after it surpassed the 12,000 mark earlier in the day.
A post-graduate in Economics, Sitharaman is familiar with the world of finance and economy. She has served as a junior minister responsible for both Finance and Corporate Affairs in the previous government and also as Commerce Minister before taking charge of the Defence Ministry during the later part of NDA-I.
Sitharaman's work is clearly cut out given the economic slowdown and rising unemployment. The forthcoming Union Budget 2019-20, to be presented in July, provides her an opportunity to prescribe appropriate remedial measures.
The Minister's immediate challenge would come from the gross domestic product (GDP) numbers for the fourth quarter as well as the full fiscal 2018-19, slated for release later on Friday by the Central Statistics Office (CSO), that is widely expected to provide confirmation of the current slowdown in the economy.
Globally, the markets traded lower in reaction to US President Donald Trump's threat to impose tariffs on Mexico.
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"On June 10th, the United States will impose a 5 per cent tariff on all goods coming into our country from Mexico, until such time as illegal migrants coming through Mexico, and into our country, stop....the tariff will gradually increase until the Illegal Immigration problem is remedied,..," Trump said in a tweet.
--IANS
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