Dear Trader…
Markets witnessed a roller-coaster ride on the Union Budget day but finally settled with the gains of over one and a half percent. The tone was upbeat from the beginning, taking cues from the global counterparts however a bout of the volatility after the FM’s speech kept the participants on their toes. Finally, the Nifty index managed to close around the day’s high around 17,576 levels. On the sector front, mostly traded in tandem with the benchmark and ended higher. The broader indices too ended in a positive range of 0.6-1.1%.
It’s a pro-growth budget and markets have also given a thumbs-up with decent close. We may see an overhang for a session or two and then the focus would shift back to corporate earnings and global cues. Meanwhile, sectors like infrastructure, housing, agriculture and defence would remain on the participants’ radar post budget for trading & investment opportunities. We recommend keeping a positive yet cautious stance and continuing with hedged positions.
Nifty futures opened at 17524.95 points against the previous close of 17361.95 and opened at a low of 17231.25 points. Nifty Future closed with an average movement of 402.75 points and a rise of around 246.90 points and 17608.85 points...!!
On the NSE, the midcap 100 index will rise 1.12% and smallcap 100 index is closing rise 0.57%. Speaking of various sectoral indices only Auto and PSU Bank stocks were seen selling on the NSE, while all other sectoral indices closed higher.
At the start of intra-day trading, February gold opened at Rs.47736, fell from a high of Rs.48099 points to a low of Rs.47581 with a rise of 354 points, a trend of around Rs.48040 and March Silver opened at Rs.61101, fell from a high of Rs.62075 points to a low of Rs.60896, with a rise of 1054 points, a trend of around Rs.62030.
The government presented a progressive budget with a vision on ensuring long term economic growth. It continued with its policy of fiscal prudence and pegged FY22 fiscal deficit at 6.9% while setting a target of 6.4% for FY23 which cheered the market.
It was clearly a capex driven budget with the thrust of the Government on sustaining the economic growth through spending across infra ecosystem. Capital spending for FY23 is targeted to increase by 35.4% to Rs7.5 lakh crore with focus on infrastructure development, supply chain, and boosting rural demand.
We expect the market to take the budget positively as it largely remain growth focused and despite several upcoming state elections, the government didn’t resort to populist measures. From a sector perspective, we expect Infra, construction, cement, capital goods, affordable housing, logistics and Defence to be major beneficiaries and remain in focus.
Technically, the important key resistances are placed in Nifty future are at 17676 levels, which could offer for the market on the higher side. Sustainability above this zone would signal opens the door for a directional up move with immediate resistances seen at 17707 – 17717 levels. Immediate support is placed at 17474 – 17404 levels.
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