Indian stock market has exhibited high volatility during the Budget speech, with the Nifty50 showing intraday fluctuations within a 2-3 per cent range 12 out of the last 14 occasions.
Indian stock markets moved higher during the trading session on Friday, ahead of the Economic Survey, which shall be presented in the parliament later today.
Finance Minister Nirmala Sitharaman shall be tabling her eight Union Budget this Saturday, that is, February 1. Market participants are expecting the FM to prioritize long-term growth with a focus on capex.
At present, LTCG tax is applicable to gains exceeding Rs 1.25 lakh from the sale of listed shares and equity mutual funds. The LTCG is taxed at 12.5 per cent, following recent amendments made vide Budget 2024.
Union Budget 2025: There is a separate proposal to increase GST on cigarettes and tobacco-related products from 28 per cent to 35 per cent. If this comes to pass, cigarette prices will in effect increase by 6–7 per cent.
Brokerage SAMCO Securities believes the announcement is positive for companies such as CDSL, CE Info Systems and Genesys.
The benchmark Sensex, which was trading up around 285 points at 72,035 when the finance minister rose to present the interim budget at 11am, had given up most of the day’s gains to hover around 71,815 -- up around 63 points – when the speech concluded around 12 noon.
The Finance Minister Nirmala Sitharaman walked on the path of fiscal prudence and enshured her government's infrastructure push stay strong. She decided not to tinker with either direct or indirect taxes, and suggested a divestment target of Rs 50,000 crore, which was much in line with Street estimates.
Brokerages are expecting a modest disinvestment target Rs 40,000 crore, which would be 0.1 per cent of GDP, compared with "the overly ambitious target" for this year.
Despite some progress, inflation risks persist as the US Fed dashed expectations for an interest rate cut in March.
Budget 2024: Jefferies anticipated a mere 7-8 per cent growth in the government capex budget for FY25 and suggested that such a move could disappoint the stock market
On February 1, 2023, the BSE500 index fell 0.62 per cent, the BSE Midcap index 0.96 per cent, and the BSE Smallcap index 1.10 per cent.
Budget 2024: Positive announcements could push Nifty beyond 21,850, and that the index could aim for all-time high levels around 22,100. A break below 21,400 and 21,200 may trigger selloff.
STT: ICRA said the removal of STT has been a long-sought demand by market participants and as the GST collection went up, this demand has again gained traction.
IRFC climbed 441 per cent since February 1, 2023. Suzlon Energy has seen its shares rallying 369 per cent since last Budget. REC Ltd soared 324 per cent while Ircon International Ltd and Rail Vikas Nigam Ltd climbed 319 per cent and 305 per cent.
For the upcoming Budget, analysts said the market would prefer fiscal prudence, though some populist measures in the wake of upcoming Lok Sabha elections cannot be ruled out.
Budget 2023: BSE bankex rose 600 points to 46,680 against the previous close of 46,079. Bank Nifty gained 498 points to 41,153 against the previous close of 40,655.Â
Budget 2023: "Entire expenditure (around Rs 2 lakh crore) under PM Garib Kalyan Anna Yojana is being borne by the government, for supplying free food grains for one year to all Antyodaya and priroity households," Nirmala Sitharaman stated.
Investors are anxious ahead of the FM’s Budget speech after indices have turned negative on a year-to-date basis affected by high volatility in global markets amid the ongoing earnings season.
PNC Infratech, Finolex Cables, APL Apollo, Hi-tech Pipes, Gati, Mahindra Logistics and Macrotech Developers are among Sharekhan’s midcap and smallcap picks.
ITC’s average target price based on 34 commendations stood at Rs 373.92, as per data available with Trendlyne, which suggests a potential 12 per cent upside for the stocks
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