Budget Stock Market Impact highlight: Sensex, Nifty show muted response to Union Budget, trade flat

Markets showed muted response to the interim Union Budget. The NSE Nifty 50 index dipped 38 points at 21,689 and the S&P BSE Sensex was at 71,645, losing 106 points at 3:30pm. They were up about 0.3% ahead of the budget.

Ranen Banerjee, Partner and Leader Economic Advisory, PwC India

The government has walked the path of fiscal prudence, and it is heartening to note that the fiscal deficit target for FY24, pegged at 5.8%, will be overachieved. The fiscal deficit being pegged at 5.1% for FY25 is a positive move as it will help free up space for private borrowings as they pick pace during the year, besides helping in containing inflationary pressures and supporting the bond markets. There has been no change on the taxation front, and we will have to wait for the full budget for any changes, with the government sticking to the norm of not making major announcements in an interim budget. The additional allocation of ₹1.1 trillion for capex, taking it to ₹11.1 trillion, should provide continuity in the pace of infra creation and in bringing down the logistics cost in the country progressively.

Rohit Arora, CEO and Co-founder, Biz2Credit and Biz2X

“In this interim budget, I am particularly impressed by the strategic measures aimed at strengthening MSMEs and the focus on innovation in the BFSI sector. As a fintech leader, I see the extension of tax exemptions for startups as a crucial move for fostering entrepreneurial spirit in our field. The commitment of a Rs. 1 lakh crore corpus for interest-free loans is a game-changer, especially for SMEs/MSMEs and startups, fuelling research and innovation. The budget's focus on technology, including the investment in deep-tech defence technologies, aligns perfectly with our mission at Biz2X to drive forward financial technology. As the economic landscape evolves, our commitment to enhancing financial inclusion and innovation in the digital lending sphere remains stronger than ever.”

Mohammad Athar- Partner and Leader CP&I & Industrial Development , PwC India:

The budget has maintained a consistent focus on infrastructure investments as a key enabler for driving India’s competitiveness.

With an outlay of ₹11.1 lakh crore, the budget has put significant focus on railway corridors to enable logistics cost reduction. Capital expenditure for airport expansions will help in serving the growth needs of one of the fastest growing aviation markets in the world. Likewise, promoting public transport investments across metro, rail, electric buses and regional rail projects will serve several objectives of the country by enabling urban transformation, decongesting our cities and driving our decarbonisation agenda for transport. Finally, tourism is a large economic development opportunity for India. Promoting development of tourism sites by states, investments in connectivity infrastructure and addition of new iconic tourism centres will enable local employment and create economic opportunities across Indian states.

On Budget 2024 day, markets continue to trade flat as Sensex remains 13.94 points down at 71,738.17, and NSE Nifty is down to 21,723.85.

Energy stocks saw a spike of 7 percent as Finance Minister Nirmala Sitharaman announced on Thursday around 1 crore households across the country will get free electricity up to 300 units under the new rooftop solar panel system scheme.

The NSE Nifty 50 index and the S&P BSE Sensex were mostly unchanged as of 2:30pm. They were up about 0.3% ahead of the budget.

Finance minister Nirmala Sitharaman on Thursday announced the withdrawal of outstanding direct tax demands up to ₹25,000 pertaining to the period up to financial year 2009-10 and up to ₹10,000 for 2010-11 to 2014-15. The move is expected to benefit about 10 million taxpayers.

“I propose to withdraw such outstanding direct tax demands up to twenty-five thousand rupees ( ₹25,000) pertaining to the period up to the financial year 2009-10 and up to ten thousand rupees ( ₹10,000) for financial years 2010-11 to 2014-15. This is expected to benefit about a crore tax-payers,” Sitharaman announced in her Interim Budget speech in Parliament.

Budget Stock Market Impact LIVE: The expansion of existing airports and development of new airports will continue expeditiously, Finance Minister Nirmala Sitharaman said on Thursday and emphasised that the country's aviation sector has been galvanised in the past 10 years.

Presenting the interim Budget for 2024-25, Sitharaman said in the last 10 years, the number of airports has doubled to 149, adding that Indian carriers have pro-actively placed orders for over 1,000 new aircraft.

Indian shares relinquished early gains on Thursday as FM Sitharaman presented the interim budget without the anticipated major announcements ahead of the country's general election.

Indian fisheries stocks jumped as the government doubled the export target in the budget, while power stocks gained as the budget proposed that 10 million houses would get free electricity via solar rooftops.

Among the sectors, auto stocks were top gainers, rising 1% as companies reported sales data for January.

FM Sitharaman: Building on the massive tripling of the infra budget outlay in the past 4 years resulting in a huge multiplier impact on growth and employment, the outlay for the next year is being increased by 11.1% to ₹11,11,111 crore. This would be 3.4% of our GDP.

"The fiscal deficit in 2024-25 is estimated to be 5.1% of GDP," says union finance minister Nirmala Sitharaman.

Budget Stock Market Impact LIVE: Sensex rises 124 points to trade at 71,876. Nifty in green at 21,743.

"Electric Vehicle Ecosystem: Our government will expand this and strengthen the E-vehicle ecosystem by supporting manufacturing and charging infrastructure. Greater adoption of E-buses for public transport networks will encouraged through payment security mechanism," says Finance minister Nirmala Sitharaman.

"FDI is 'First Develop India'... FDI inflow during 2014 to 2023 was ₹596 billion US dollars, marking a golden era. This was twice the FDI inflow between 2005 to 2014. For sustained FDI, we are negotiating bilateral investment treaties with foreign partners," says FM Sitharaman.

FM Sitharaman said direct benefit transfers of ₹34 lakh crore through Jan Dhan accounts have resulted in savings of ₹2.7 lakh crore.

The government has extended 43 crore loans aggregating to ₹22.5 lakh crore under the PM Mudra Yojana, FM Nirmala Sitharaman said in her budget speech.

A corpus of ₹1 lakh crore will be established through a 50-year interest-free loan to provide long-term financing with extended tenures and minimal interest rates, says FM Sitharaman.

Goods and Services Tax (GST) has enabled one nation, one market, one tax. Tax reforms have led to the deepening and widening of tax base. Strengthening of the financial sector has helped in making savings, credit and investments more efficient," says union finance minister Sitharaman.

"The economy is doing well; people are living better and earning better with greater aspirations for future. Average real income of people has increased by 50 per cent, inflation is moderate," says Union finance minister Sitharaman.

FM Sitharaman says, “The government is equally focused on GDP - Governance, Development and Performance. She adds, ”The next five years will be the years of unprecedented development."

Fintech firm Paytm's shares tumbled 20 per cent day after the Reserve Bank of India barred its lending arm Payments Bank from accepting new deposits.

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