Mumbai, Feb 29 (IANS) Union Budget announcements, combined with negative Asian cues, and a dip in the rupee value depressed the Indian equity markets during the mid-afternoon trade session on Monday.
Consequently, the barometer 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE) traded flat.
During the Union Budget announcements, the barometer index plunged to a fresh 52-week low. However, it pared most of its losses and was trading flat.
Similarly, the wider 50-scrip Nifty of the National Stock Exchange (NSE) traded flat. It inched down by 2.05 points, or 0.03 percent, to 7,027.70 points.
The Nifty touched a fresh 52-week low of 6,825.80 points.
The Sensex, which opened at 23,238.50 points, traded at 23,203.66 points (at 1.15 p.m.), up 49.36 points or 0.21 percent from the previous day’s close at 23,154.30 points.
During the intra-day trade so far, the Sensex touched a high of 23,293.80 points and a low of 22,494.61 points — its fresh 52-week low.
The Union Budget 2016-17 was tabled in parliament on Monday.
Finance Minister Arun Jaitley disclosed the government’s spending on the rural sector, infrastructure and agricultural credit.
“Markets were disappointed, as investors expected some out-of-box reform measures. However, the budget did provide some major reform measures, as well as healthy fiscal deficit targets,” Anand James, co-head, technical research desk with Geojit BNP Paribas Financial Services, told IANS.
“Roads and infrastructure sector were supported.”
Vaibhav Agarwal, vice president and research head at Angel Broking, elaborated that “There were some big negatives like the hike in securities transaction tax and lower bank recapitalisation levels.”
Jaitley proposed to hike securities transaction tax for options to 0.05 percent.
“Big positives include the hike in rural spending and infrastructure sector,” Agarwal noted.
Devendra Nevgi, chief executive of ZyFin Advisors cited: “More rational budget in the long term, rightly focussing on infrastructure, rural economy, social sectors, education, health, financial sector etc.”
“The bottom of the pyramid is targeted, which is good for the long term. Markets will now focus on execution which remains the key. Fiscal deficit targets for next year is positive for bond markets.”
At the same time, Jaitley maintained the FRBM (fiscal responsibility and budget management) targets.