The primary market remained dull during April 1999. The total resource mobilisation which was Rs.870.93 crore in February 1999, fell to Rs.439.95 crore in March 1999, and further to Rs. 90.18 crore in April 1999 reflecting a poor state of capital market. When the position in April 1999 is compared to the level of capital raised in April 1998, there was a huge decrease in April 1999 over the mobilisation of capital of Rs. 409.3 in April 1998.

During the month under review, the secondary market witnessed bearish trend in equity prices. The BSE Sensex climbed down through the entire month. The BSE Sensex declined from 3606.3 on April 1, 1999 to 3325.7 on April 29, 1999. Jr. Nifty was lower at 12.7 per cent. Thus the month of April suffered large reversals.

The primary capital market is however, expected to perform better during 1999-2000 as mutual funds have been given substantial fiscal incentives for investing in equity capital. The budget for 1999-2000, has proposed to exempt the income of unit holders received from UTI or from mutual funds from income tax provided more than 50 per cent has been in equity shares. As a result outflow of funds from mutual funds narrowed from Rs. 1203.92 crore during April – February 1999 to Rs. 949.67 crore during April – March 1998-99.