Obama vows to slash deficit in budget plan

The US markets ended lower as President Barack Obama outlined his budget plan for the year. In a bid to cut down on spending and reducing the deficit, he proposed a radical shift to reform healthcare and change tax norms. The Obama administration sees the FY09 deficit at $1.75 trillion.

Healthcare stocks tanked amid worries that President Obama's budget will clamp industry profits.

The Dow Jones industrial average declined 88.81 points, or 1.2 per cent, to 7,182.08. The S&P 500 index fell 12.07 points, or 1.6 per cent, to 752.83 and the Nasdaq composite index was down 33.96 points, or 2.4 per cent, to 1,391.47.

Radical shift in economic policy

"This budget is an honest accounting of where we are and where we intend to go,” Obama said, "For too long, our budget has not told the truth about how precious dollars are spent. Large sums have been left off the books including the true cost of fighting in Iraq and Afghanistan and that kind of dishonest accounting is not how you run your family budgets at home, not how your government should run its budgets either."

"No part of my budget will be free from scrutiny or untouched by reform,” the US President added. “We will end contracts that have wasted billions in Iraq and end tax breaks for corporations that ship jobs overseas. And we will save billions of dollars by rolling back tax cuts for the wealthy Americans giving a mid class tax cut to 95 per cent of hardworking families."

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In economic news, new home sales slumped 10.2 pr to a record low of 3.09 lakh in January as prices hit a five-year low. New jobless claims jumped by 36,000 to 6,67,000, the highest since 1982 and durable-goods orders dropped 5.2 per cent to $163.8 billion in January, more than double of what was expected.

Commodity check

Crude oil jumped to settle over $45 a barrel on expectations that OPEC will cut output again and on signs of a rebound in gasoline demand in the United States.

Copper rose to the highest price in more than two weeks on speculation that government spending in the US and China will spur a rebound in metal demand.

Gold fell for the fourth straight day — the longest slide in a month — on speculation that equities will rebound, reducing the appeal of the precious metal as an alternative investment. Silver sank the most in 12 weeks.

A look at how the Indian ADRs performed:

Change

Low

Infosys

INFY

24.20

-0.42

6.89%

3,290,143

25.06

24.2

Sify

SIFY

0.588

0.04

1.25%

28,264

0.59

0.55

Rediff.com India

REDF

1.62

0.02

-5.29%

5,300

1.67

1.59

Satyam

SAY

1.61

-0.09

-1.82%

2,678,971

1.75

1.57

Wipro

WIT

5.93

-0.11

-5.17%

225,881

6.13

5.85

ICICI Bank

IBN

12.83

-0.70

-1.93%

3,620,899

13.21

12.7

HDFC Bank

HDB

51.77

-1.02

-3.00%

767,217

53.6

51.59

MTNL

MTE

2.59

-0.08

-0.19%

53,825

2.67

2.55

Tata Comm

TCL

15.99

-0.03

-2.84%

61,800

16.31

15.84

Dr Reddy's Lab

RDY

8.22

-0.24

-1.33%

142,388

8.41

8.12

Tata Motors

TTM

3.70

-0.05

-3.59%

1,118,280

3.93

3.57

Patni Computer

PTI

4.83

-0.18

1.06%

14,660

4.95

4.75

Sterlite Ind

SLT

4.75

0.05

-

3,375,106

4.90

4.66

Original news source