Budget 2021: Market volatility to continue, say analysts

In the last week, the 30-share BSE benchmark tumbled 2,592.77 points or 5.30 per cent due to profit-booking ahead of the Union Budget.

The markets will be keenly watching the budget announcements made by finance minister Nirmala Sitharaman in Parliament on Monday.

Sensex (PTI photo)

The Sensex has lost nearly eight per cent from the record high of 50,000, in one of the tumultuous sharp fall of stock markets last week. This year, Sensex lost 3% in a month before the budget is presented in parliament while it slipped 4% last year. In three out of five times, the Sensex has given negative returns in a month prior to the budget.

Analysts say that market volatility is expected to continue this week in the wake of Union Budget, macro data and RBI policy.

The Economic Survey 2020-21 was tabled in the Lok Sabha on Friday.

It projected that India's economy is likely to grow by 11 per cent in the fiscal year beginning April 1 as a vaccine drive and rebound in consumer demand help it emerge from the carnage inflicted by a strict coronavirus lockdown.

The rebound will follow an estimated 7.7 per cent contraction in the Gross Domestic Product (GDP) in the current financial year, the document said.

According to the survey, the "V-shaped recovery is supported by Covid vaccination drive."

In the last week, the 30-share BSE benchmark tumbled 2,592.77 points or 5.30 per cent due to profit-booking ahead of the Union Budget.

(With inputs from agencies)