MARKET VIEW - BSE Sensex falls 6 pct after budget

MUMBAI (Reuters) – The BSE Sensex recorded its biggest fall in six months after Finance Minister Pranab Mukherjee unveiled the federal budget on Monday.

The government said it would raise spending to spur growth, pushing the 2009/10 fiscal deficit to a higher-than-expected 6.8 percent of GDP. Mukherjee estimated 2008/09 economic growth at 6.7 percent.

The benchmark index fell as much as 6.4 percent, its single biggest fall in a day since Jan. 7 when the markets were spooked by the unfolding of the fraud at Satyam Computer (now Mahindra Satyam).

Pranab Mukherjee's budget on Monday was the inaugural budget of the new Congress-led coalition government which was voted into power in May.

The benchmark BSE sensitive index had risen 17 percent on May 18 after the election results on expectations the government now had a free hand to push through reforms and set the economy on the growth path again.

Following are comments from market participants on Monday's fall:

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