Budget Cheers Market: Sensex Hits 50,000-Mark; Banks, Auto Stocks Rise

New Delhi: The BSE benchmark Sensex surged over 1000 points to hit 50,000-mark and NSE Nifty climbed 356 points to 14,634 in opening trade on Tuesday, a day after Union Finance Minister Nirmala Sitharaman presented an expansionary Union Budget for 2021-22, which sought to pull the economy out of the pandemic-induced slump through increased spending on infrastructure, healthcare and farm sectors without resorting to higher taxation. Also Read – Budget 2021 Market Reaction Updates: Sensex Ends 2,341 Points Higher, Nifty Above 14,250; Nifty Bank at All-time High

The government has projected a fiscal deficit of 9.5 per cent of the GDP for the current fiscal, hit by the COVID-19 pandemic, and 6.8 per cent in 2021-22 as it sought to strike a balance between supporting growth and maintaining fiscal discipline.

Sensex touches 50,000-mark, currently trading at 49,945.91

— ANI (@ANI) February 2, 2021

Budget Cheers Markets

In the Sensex pack, all shares were trading in the green barring HUL.

Enthused over various measures announced in the Budget on Monday, the Sensex zoomed 2,314.84 points or 5 per cent to finish at 48,600.61; and the Nifty soared 646.60 points or 4.74 per cent to finish at 14,281.20 the biggest single-day gains ever for the benchmarks on Budget day.

Foreign portfolio investors (FPIs) purchased shares worth a net Rs 1,494.23 crore on Monday, according to exchange data. Asian markets were also trading broadly higher in afternoon trade.

How Market Experts Reacted to Budget

Economists and market analysts are of the view that this is a bold growth-oriented budget and absence of the much-feared COVID tax and the surcharges on Income Tax is a great relief.

Besides, privatisation of two nationalised banks and proposal of monetisation of assets like land are clear positives, according to them.

Market response to the budget reflects growth optimism and in brief, the government has presented a pragmatic, bold and visionary budget in these difficult times, they said.

“It has been a great Budget in the current pandemic. Market has given a clear thumbs-up. One couldn’t have asked for more, of the total borrowings of Rs 1,50,000 crore a whopping Rs 1,20,000 crore is going for investment. Clearly the government has sacrificed fiscal deficit for growth. No tinkering on taxes, including personal tax and a giant leap of divesting two state-run banks and opening up of market by making way for the LIC IPO and foreign ownership in insurance companies has been a welcome move and the primary reason for the rise in stock market,” said Jaideep Hansraj, MD & CEO, Kotak Securities.

(With agency inputs)