Budget 2026: Infosys, NTPC, Coal India, NMDC, among key stock picks by Rajesh Bhosale of Angel One

As Finance Minister Nirmala Sitharaman gears up to unveil the Union Budget for 2026 on Sunday, February 1, those in the market are tempering their expectations for significant spending surprises. Analysts generally anticipate that fiscal discipline will be maintained, with minor increases aimed at sectors that require strong execution rather than major policy overhauls.

Financial experts have pointed out that limited fiscal capacity is likely to steer the government toward speeding up structural reforms and encouraging private investment, instead of increasing overall funding.

Analysts anticipate that volatility around budget day will remain elevated, with potential sell-offs likely if fiscal measures fall short or targets are missed, which could lead to increased bond yields and tighter liquidity conditions.

External risks include geopolitical tensions, currency fluctuations, and disruptions in global trade, while delays in implementing domestic policies might undermine investor confidence.

According to experts, concerns about overvaluation, foreign institutional investor outflows, and a possible collapse of the AI bubble are further obstacles that could hinder the Nifty 50's ascent toward 29,000 by 2026.

Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One, discusses trading strategies, and the sectors and stocks to be on the lookout on Sunday, February 1, 2026.

Budget Watch: Select Sectors Poised to Outperform Amid Market Volatility

According to Rajesh Bhosale, as the Union Budget approaches, the Indian equity markets remain volatile, with the benchmark Nifty 50 attempting a bounce from its long-term support near the 200-day simple moving average (200-DSMA). While broader indices may continue to witness swings in the near term, sectoral divergence is clearly emerging, with select spaces showing strong relative strength and signs of potential outperformance based on price action.

Public Sector Enterprises (PSE): A Structural Breakout in the Making

The Public Sector Enterprises (PSE) space is emerging as one of the most promising themes. The Nifty PSE Index has been locked in a consolidation phase since January 2025, with repeated rejections near the 10,000 mark. This level acted as a major resistance on three separate occasions, effectively capping upside for over a year.

The recent decisive move beyond this hurdle marks a multiple pattern breakout. From a short-term perspective, prices have broken out of a rising channel, while on a higher time-frame, the weekly chart reveals a classic Cup and Handle formation—a pattern typically associated with strong continuation moves.

Following this breakout after a prolonged consolidation, the index is expected to witness renewed momentum and relative outperformance. In the near term, prices may advance towards all-time highs around 11,500, making any intermediate dip a buying opportunity rather than a cause for concern.

Preferred stocks from the PSE basket: Oil and Natural Gas Corporation Ltd (ONGC), NTPC Ltd, NMDC Ltd, Coal India Ltd, Bharat Petroleum Corporation Ltd (BPCL).

Information Technology (IT): Relative Strength Amid Market Uncertainty

According to Rajesh Bhosale, another sector showing encouraging signs is the Information Technology (IT) space. While the Nifty IT Index remains well below its all-time highs—especially when compared with heavyweight peers such as Nifty Bank, Metal, and Auto—recent price action suggests a meaningful shift in momentum.

The sector has started forming a higher top–higher bottom structure, indicating a change in trend. Additionally, RSI readings have moved above 60 across daily, weekly, and monthly time frames, signalling broad-based bullish strength. Notably, during the recent phase of market panic, IT stocks displayed relative resilience, highlighting underlying accumulation.

Given these technical developments, the IT sector is well-positioned to deliver steady performance in the coming weeks, especially if market volatility persists.

Preferred stocks from the IT space: Tech Mahindra Ltd, Infosys Ltd, HCL Technologies Ltd.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.