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Photo: Reuters
Photo: Reuters

Markets end 5% higher on Budget boost; financials, auto stocks shine

  • Benchmark equity indices settled 5% higher on Monday after FM Nirmala Sitharaman in the Union budget chalked out plans to double healthcare spending and lift caps on foreign investment in its vast insurance market to pull the economy out of a slump.

Investors will keenly watch how Union finance minister Nirmala Sitharaman balances the need to spend big to spur a budding economic recovery amid limited fiscal room as she rises to present the Union budget today. Track this space for the latest stock market updates.

01 Feb 2021, 03:36:34 PM IST

Market closing

Benchmark equity indices settled 5% higher on Monday after FM Nirmala Sitharaman in the Union budget chalked out plans to double healthcare spending and lift caps on foreign investment in its vast insurance market to pull the economy out of a slump.

Sensex ended at 48,600.61, up 2314.84 or 5.00%, while Nifty climbed 646.60 points or 4.74% to settle at 14,281.20.

IndusInd Bank, closing over 15% higher, was the top Sensex gainer followed by ICICI Bank, Bajaj Finserv and SBI, Dr Reddy's, TechM and HUL were the only laggards on the 30-share barometer.

BSE Sensex
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BSE Sensex
01 Feb 2021, 02:58:42 PM IST

Mohit Ralhan, Managing Partner and Chief Investment Officer, TIW Private Equity on Budget 2021

"This is an extremely balanced budget given that the economy is just emerging out from a contraction and the risk of pandemic is still around. The government has relied on increasing government spending to boost the economy and therefore the fiscal deficit for FY22 has been pegged at 6.8% of GDP. More than doubling of the allocation to Healthcare expenditure was quite necessary to better fight the pandemic and we also saw a 34% increase in capital expenditure with a sharp focus on rail and road to boost the industrial output. There are also quite a few measures that will have a long-term positive impact on the Indian economy including formation of asset reconstruction company, measures to combat air pollution, divestment of public sector banks, increase in FDI limit to 74% in Insurance, promotion of digital payments and increasing tax transparency through digitization. Overall, the closely monitored budget rightly targets the areas to accelerate economic recovery without increasing any undue tax burden."

01 Feb 2021, 02:58:07 PM IST

Nifty Bank outperforms benchmark indices

01 Feb 2021, 02:46:17 PM IST

Bharti Airtel up over 4%

The board of directors of the company in its meeting scheduled on 3rd February will consider routine financing/ re-financing strategies and any consequent raising of capital through various instruments subject to applicable statutory approvals, Bharti Airtel said in a BSE filing.

01 Feb 2021, 02:36:08 PM IST

Indian bonds tumble, rupee slides on near-record debt sales

Sovereign bonds in India slid and the rupee declined after the finance minister outlined a higher-than-expected borrowing plan for the new fiscal year.

The yield on the benchmark 10-year bond rose as much as fifteen basis points to 6.057%, its highest since Sept. 29. The rupee declined 0.2% to 73.10 per dollar.

Finance Minister Nirmala Sitharaman outlined a gross borrowing plan of 12 trillion rupees ($164 billion) for the 12 months starting April, more than 10.6 trillion rupees estimated in a Bloomberg Survey of fifteen analysts.

The government also plans to raise an additional 800 billion rupees by end of the current fiscal year in March, on top of its projection of record 13.1 trillion rupees of debt sales. The new borrowing amount is also higher than the previous five year’s average of 6.07 trillion rupees.

01 Feb 2021, 01:52:04 PM IST

Stocks that moved during FM Nirmala Sitharaman's speech

Key Indian equity benchmark indices the Nifty50 and the Sensex were traded in the green, rising more than percent each, while finance minister Nirmala Sitharaman was delivering the speech for Union Budget 2021. Here's a list of stocks that reacted to the sector-specific proposals announced by the FM.

01 Feb 2021, 01:50:29 PM IST

PSU banks rise as FM proposes to ₹20,000 crore capital infusion

The government on Monday announced that it will set up an asset reconstruction company (ARC) and an asset management company (AMC) to house stressed assets currently in book of Indian banks. That apart, the government would also infuse 20,000 crore into public sector banks as part of its recapitalisation plans. The Economic Survey released last Friday had called for a clean up of bank balance sheets after the forbearance to be accompanied by a recapitalisation.

01 Feb 2021, 01:38:02 PM IST

10-year bond yields jump 14 bps on higher government borrowing plans

Yields on 10-year bonds surged 14 basis points after finance minister Nirmala Sitharaman said the government plans to borrow a gross 12 trillion over the next financial year.

Gross borrowing was expected to be 10.60 trillion and net borrowing at 8 trillion, according to a median forecast of 15 analysts surveyed by Bloomberg news.

01 Feb 2021, 01:37:27 PM IST

Sitharaman steps up capital spending to salvage economy

Finance minister Nirmala Sitharaman on Monday proposed a 26% increase in capital spending for FY22 to Rs5.54 trillion to rev up India's economic engine. India's gross domestic product (GDP) is expected to contract by 7.7% this fiscal year due to the covid-led disruptions. (Full report)

01 Feb 2021, 01:16:20 PM IST

Shree Cement up 5%

The company posted over two-fold jump in consolidated net profit to 631.58 crore for the third quarter ended December 31, 2020. It had reported a net profit of 311.83 crore in October- December period a year ago, Shree Cements said in a filing to BSE.

01 Feb 2021, 01:10:14 PM IST

IndusInd Bank, ICICI Bank, SBI, HDFC top Sensex gainers

BSE Sensex
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BSE Sensex
01 Feb 2021, 01:08:13 PM IST

Sensex up over 1600 points

01 Feb 2021, 01:03:15 PM IST

Govt. thinks bold on privatisation, but sets lower target from asset sales

In fiscal year 2022, the government aims to complete disinvestment in a slew of public assets including BPCL Ltd, Air India Ltd and Concor Ltd, the finance minister said in her latest Union Budget speech. Further, the initial public offering of national insurer LIC of India is also likely to hit the primary market in fiscal year 2022. Further, the Niti Aayog will be preparing a list of new public assets which can be divested, the finance minister added. There will also be sales of investment trusts (InvITs) with roads and transmission assets as the underlying. Importantly, the finance minister said that only minimal central public sector enterprises will be retained in sectors, and that the others will be privatised.

The vision for privatisation, in short, is bold. But the target for FY22 has been set at 1.75 trillion, compared to 2.1 trillion targeted for FY21 a year ago. Of course, as the saying goes, the proof of its pudding is in its eating. "The market may not trust the disinvestment targets till a few successes are visible." analysts at Credit Suisse said in a pre-budget note, while pegging the disinvestment target for FY22 at the same levels of budgeted estimates of FY21.

01 Feb 2021, 12:53:35 PM IST

Sitharaman seeks to bring down fiscal deficit to 4.5% of GDP by FY26

Finance minister Nirmala Sitharaman has proposed a gradual fiscal consolidation path to bring down fiscal deficit to 4.5% by FY26, signalling a counter-cyclical fiscal policy to boost medium term economic growth. For Budget FY22, she has pegged fiscal deficit at 6.8% of GDP, down from 9.5% of GDP in FY21. Finance minister will also introduce amendments to the FRBM Act to make necessary change in the fiscal consolidation roadmap.

Accepting the recommendations of the 15th Finance Commission (FFC), it has increased the ceiling for state borrowing to 4% from 3% allowed earlier, with the facility to allow additional 0.5% conditional borrowing. The FFC’s recommendation to retain 41% share of states in divisible pool of taxes was also accepted by the government.

01 Feb 2021, 12:52:39 PM IST

FM's Direct Tax proposals

No income tax filing for senior citizens above 75 years of age having only pension, interest income.

FM proposes to set-up a faceless dispute resolution mechanism for small taxpayers, reduce time allowed to re-open tax investigation to 3 years versus 6 years now.

Threshold for tax audit proposed to be increased to 10 crore versus 5 crore (for those transacting 95% digitally).

Affordable housing deduction extended by one year to FY22 on notified rental housing projects.

Tax holidays for startups extended by one year, till 31st March 2022.

01 Feb 2021, 12:24:55 PM IST

FY21 fiscal deficit target pegged 9.5% of GDP

FY21 revised expenditure target at 34.50 lakh crore.

FY21 fiscal deficit target pegged 9.5% of GDP.

FY22 fiscal deficit target 6.8% of GDP.

Net borrowings for states capped at 4%

01 Feb 2021, 12:17:30 PM IST

Agriculture credit target raised to ₹16.5 lakh cr in 2021-22

FM Nirmala Sitharaman has proposed to increase the agriculture credit target to 16.5 lakh crore in 2021-22.

01 Feb 2021, 12:15:41 PM IST

Allocation to rural infra development increased

FM Nirmala Sitharaman has proposed to increase the allocation to rural infra development to 40,000 cr in next fiscal from 30,000 crore in FY21.

01 Feb 2021, 12:09:12 PM IST

Divestments to be completed by FY22

All divestments announced so far to be completed in FY22. BPCL, CONCOR, Pawan Hans, Air India divestments to be completed in FY22.

01 Feb 2021, 12:06:44 PM IST

Auto stocks gain on scrappage policy

Nifty Auto
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Nifty Auto
01 Feb 2021, 12:00:48 PM IST

Professionally managed DFI to be set up

Professionally managed Development Financial Institution to be set up, to provide, enable & catalyze infra financing.

20,000 crore to capitalize this institution.

Aim is to have lending portfolio of at least 5 lakh crore in 3 years.

01 Feb 2021, 11:57:33 AM IST

FY22 divestment target at 1.75 lakh crore

01 Feb 2021, 11:53:57 AM IST

FDI limit in insurance hiked to 74%

FM Sitharaman has proposed to increase the FDI in insurance to 74% from 49% to help Indian insurers get access to more foreign capital for expanding businesses.

01 Feb 2021, 11:49:03 AM IST

India gets a ₹3.05 trillion electricity distribution reform scheme, power connection portability

Finance minister Nirmala Sitharaman on Monday announced a 3.05 trillion electricity distribution reform programme in the Union budget to help reduce losses and improve the efficiency of electricity distribution companies (discoms).

Also, while presenting her third Union Budget she announced putting a framework in place for allowing a choice of electricity supplier to the consumers. The ongoing Parliament session will consider the Electricity (Amendment) Bill, 2021, that has proposed amendments including measures such as “de-licensing" of the power distribution business to bring in competition.

01 Feb 2021, 11:41:20 AM IST

FM announces Urban Swachh Bharat Mission 2.0

Urban Swachh Bharat Mission 2.0 with outlay of 1,41,678 crore over 5 years from 2021.

Focused on complete fecal sludge management, waste water treatment, source segregation, management of waste from urban construction, bioremediation of legacy dump sites.

01 Feb 2021, 11:35:24 AM IST

Budget 2021 unveils roadmap for voluntary scrapping of vehicles

Finance minister Nirmala Sitharaman on Monday announced the much-awaited voluntary vehicle scrappage policy to phase out unfit, pollution causing vehicles. The policy will help in reducing vehicular pollution and cut oil import bill. Vehicles will undergo fitness test in automated centres. Age of the vehicles will be 15 years in case of commercial vehicles and 20 years in case of personal vehicles. Ministry of road transport and highways will announce the finer details of the policy.

01 Feb 2021, 11:32:34 AM IST

FM increases capital expenditure by 34.5%

Finance Minister increases FY22 capital expenditure by 34.5% to 5.54 lakh crore.

PM Atmanirbhar Swastha Bharat to be launched with an outlay of 64,180 cr over 6 years.

01 Feb 2021, 11:16:10 AM IST


01 Feb 2021, 11:11:28 AM IST

FM Nirmala Sitharaman says...

Total covid support measures amount to 13% of country's GDP.

Total covid support measures by the RBI and government amount to 27.1 lakh crore.

Atmanirbhar package accelerated the reforms.

PM Garib Kalyan Yojana, Aatmanirbhar Bharat package, other packages were 5 mini budgets itself.

01 Feb 2021, 11:08:17 AM IST

KRBL falls 15%

The share price of leading basmati rice producer, KRBL dropped by over 15% on Monday after the Enforcement Directorate (ED) arrested the joint managing director of KRBL, Anoop Kumar Gupta in connection with a money laundering probe into the over 3,600-crore VVIP choppers purchase scam case.

01 Feb 2021, 11:03:18 AM IST

ICICI Bank, HDFC twins, RIL lift Sensex by over 500 points

Sensex contributors
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Sensex contributors
01 Feb 2021, 11:02:07 AM IST

Sensex at day's high

01 Feb 2021, 10:59:53 AM IST

Just in: Cabinet approves Union Budget 2021

01 Feb 2021, 10:55:06 AM IST

Union Cabinet meeting underway ahead of budget 2021-22 presentation

A Union Cabinet meeting is underway ahead of the presentation of Budget 2021-22 by finance minister Nirmala Sitharaman at the Parliament on Monday.

Sitharaman and her team met President Ram Nath Kovind before presenting her third budget on Monday. She was accompanied by her deputy Anurag Thakur and other officials of the Finance Ministry.

With the Union Budget 2021-22 set to be delivered in paperless form for the first time, Sitharaman replaced the Swadeshi 'bahi khata' and switched to a tablet.

For the first time ever, the Budget will be paperless this year due to covid. The Budget speech will begin at around 11 am today with Sitharaman beginning it with an address to the speaker of Lok Sabha. Usually, the duration of the presentation ranges from 90 to 120 minutes.

01 Feb 2021, 10:51:06 AM IST

Ashok Leyland up 1%

Total sales up 11% at 13,126 units versus 11,850 units y-o-y.

Light Commercial Vehicle sales up 40% at 5,752 units versus 4,096 units y-o-y.

01 Feb 2021, 10:46:53 AM IST

Sitharaman again opts for 'Bahi-Khata' for Budget

Finance Minister Nirmala Sitharaman on Monday used her trademark 'Bahi-Khata', a ledger wrapped in a red-coloured cloth, to carry Budget documents as she arrived in Parliament House to present her third straight Budget.

Sitharaman, India's first full-time woman Finance Minister, had in July 2019 ditched the colonial legacy of a Budget Briefcase for the traditional Bahi-Khata to carry Union Budget Papers. She used the same last year and again on Monday.

Her budget for fiscal year beginning April 2021 (FY 2021-22) is Modi government's 9th straight budget since 2014 (including one interim budget presented ahead of general elections in 2019).

01 Feb 2021, 10:45:02 AM IST

Maruti Suzuki January sales up 4.3% y-o-y

Maruti Suzuki India Limited posted total sales of 160,752 units in

January 2021, up 4.3% from 154,123 units in the corresponding month of last year. Total domestic sales stood at 148,307 units, up 2.6% y-o-y.

01 Feb 2021, 10:43:00 AM IST

India's January manufacturing PMI at 57.7 Vs 56.4 in December

01 Feb 2021, 10:33:12 AM IST

Rupee update

The rupee appreciated by 8 paise to 72.88 against the US dollar in opening trade on Monday ahead of the Union Budget 2021-22 presentation in Parliament.

At the interbank forex market, the domestic unit opened at 72.89 against the US dollar, then inched higher to 72.88, registering a rise of 8 paise over its previous close.

On Friday, the rupee had settled at 72.96 against the American currency.

01 Feb 2021, 10:31:26 AM IST

With improving asset quality outlook, ICICI Bank gives investors enough to love

ICICI Bank has given more than one reason for its investors to load up. Over the weekend, the private sector lender reported a net profit that beat estimates and asset quality that showed a steady improvement. A sanguine outlook by the management has only added to the optimism. (Full report)

01 Feb 2021, 10:18:33 AM IST

Tech Mahindra drops 3.5%

IT services exporter Tech Mahindra reported a 14.3% jump in its December quarter net profit at 1,309.8 crore driven largely by improving profit margins while the revenues remained stable. The Mahindra Group company had registered a net profit at 1,145.9 crore in the year-ago period and 1,064 crore in the preceding September quarter.

01 Feb 2021, 10:05:04 AM IST

Tata Power receives LOI from OERC

The Odisha Electricity Regulatory Commission (OERC) has selected Tata Power Ltd as the successful bidder to own the license for the distribution and retail supply of electricity in North Eastern Electricity Supply Company of Odisha Limited (NESCO) Utility license areas.

The proposed sale of NESCO Utility to the Company will be through the formation of a Special Purpose Vehicle (SPV) entity in which the state government will own 49% in the equity share capital and Tata Power will hold remaining 51%. The SPV is expected to generate revenue in excess of 2,470 crore.

01 Feb 2021, 09:52:16 AM IST

UPL stock under pressure

Agro-chemical company UPL on Friday posted a 12% growth in profit after tax (PAT) at 793 crore during the third quarter of 2020-21.

The company's PAT stood at 707 crore during the corresponding quarter of 2019-20, UPL said in a statement.

UPL's revenue grew 3% during the quarter under review at 9,125 crore as compared to 8,892 crore in the same quarter of financial year 2020.

01 Feb 2021, 09:38:11 AM IST

Escorts Ltd reports 49% rise in sales in January 2021

Escorts Ltd Agri Machinery Segment (EAM) in January 2021 sold 9,021 tractors, its highest ever January sales and registering a growth of 48.8% against 6,063 tractors sold in January 2020.

Domestic tractor sales in January 2021 was at 8,510 tractors registering a growth of 45.6% against 5,845 tractors in January 2020. "The tractor market continues to be strong on back of positive macro-economic factors and strong rural cash flows. The supply side situation is normalizing and is no longer expected to be a bottleneck to meet demand. However rising inflation continues to be a worry," the conpany said. Export tractor sales in January 2021 stood at 511 tractors against 218 tractors sold in January 2020, registering a growth of 134.4%.

01 Feb 2021, 09:32:00 AM IST

IT, pharma stocks under pressure

Sectoral Indices
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Sectoral Indices
01 Feb 2021, 09:24:54 AM IST

ICICI Bank trades higher

The Mumbai-headquartered lender on Saturday reported a 17.73 % jump in its December quarter consolidated net profit to 5,498.15 crore, helped by a jump in core income but experienced a surge in bad assets from its retail loans. On a standalone basis, ICICI Bank showed a 19.12% rise in the post-tax profit to 4,939.59 crore for the reporting quarter, up from 4,146.46 crore in the October-December 2019 period.

01 Feb 2021, 09:19:47 AM IST

Market opening

Equity benchmarks Sensex and Nifty started the session on a high note ahead of the Union budget on Monday led by gains in ICICI Bank, HDFC twins L&T and Infosys.

Sensex opened at 46,617.95, up 332.18 points or 0.72%, while Nifty advanced 124.00 points or 0.91% to open at 13,758.60.

ICICI Bank, up over 2%, was the top Sensex gainer followed by L&T, Sun Pharma and Bharti Airtel. TCS, Ultratech Cement and Bajaj Finserv were among the laggards. Of 30 Sensex shares, 27 opened in the green.

BSE Sensex
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BSE Sensex
01 Feb 2021, 09:07:27 AM IST

Market pre-opening

Indian stocks traded higher on Monday ahead of Union Budget 2021. At 9:04am, Sensex was at 26,508.56, up 222.79 points or 0.5%, while Nifty advanced 91.80 points or 0.7% at 13,726.40.

01 Feb 2021, 08:34:38 AM IST

Indian stocks face Budget hurdle with history as guide

If history is a guide, the recent rough ride for Indian stocks will continue after Monday’s budget.

The S&P BSE Sensex index has climbed in the month after budget day on only two of the past seven years since Prime Minister Narendra Modi came to power, while falling or staying rangebound on other occasions. Risks are compounded in 2021 given stretched valuations.

The Sensex had a blistering advance last quarter -- even as data showed that the economy had plunged into recession -- led by record inflows from foreign investors. But there are signs the rally is petering out: the index clocked its biggest weekly decline since early May from its peak on Jan. 20. (Bloomberg)

01 Feb 2021, 08:34:38 AM IST

Market at close on Friday

The Sensex and Nifty buckled under selling pressure for the sixth session on the trot on Friday as the pre-Budget Economic Survey failed to cheer investors amid continued selling by foreign funds and a bearish trend overseas.

Both the benchmark indices fluctuated between gains and losses in a highly volatile session.

The 30-share BSE Sensex crashed 588.59 points or 1.26% to finish at 46,285.77 -- taking the six-session aggregate loss to 3,506.35 points or 7.04 per cent. Intra-day, the index swung 1,263.20 points.

Likewise, the NSE Nifty furthered its loss by 182.95 points or 1.32% to settle at 13,634.60. Over the last six days, the NSE barometer has shed 1,010.10 points or 6.89%.

01 Feb 2021, 08:34:38 AM IST

Asia shares try to rally

Asian shares tried to rally on Monday as Wall Street continued to struggle with doubts about vaccine rollouts and economic recovery, while silver surged as newly empowered retail investors turned speculative eyes to precious metals.

MSCI's broadest index of Asia-Pacific shares outside Japan recouped early losses to rise 0.7%, bouncing after four straight sessions of losses.

Japan's Nikkei added 0.8%, after shedding almost 2% on Friday, while Chinese blue chips gained 0.5% as the country's central bank injected more cash into money markets.

Singapore's SGX Nifty advanced nearly 1%.

01 Feb 2021, 08:34:38 AM IST

US Stocks decline

US stock indexes dropped, closing out the Friday session with the biggest weekly fall since October, as investors gauged the ramifications of Johnson & Johnson's covid-19 vaccine trial results, while a standoff between Wall Street hedge funds and small, retail investors added to volatility.

The Dow Jones Industrial Average fell 620.74 points, or 2.03%, to 29,982.62, the S&P 500 lost 73.14 points, or 1.93%, to 3,714.24 and the Nasdaq Composite dropped 266.46 points, or 2%, to 13,070.70.

All three main indexes suffered their biggest weekly fall since the end of October, as the Dow lost 3.28%, the S&P fell 3.31% and the Nasdaq declined 3.49%. For the month, the Dow dipped 2.04%, the S&P shed 1.12% and the Nasdaq gained 1.42%.

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