The budget failed to bring cheer to the bourses as stocks ended on a flat note over a modest 10 per cent increase in capex for 2025-26 that fell short of expectations.
At Dalal Street, the BSE Sensex settled with gains of only 5.39 points despite finance minister Nirmala Sitharaman’s much-anticipated tax reliefs that are expected to boost urban consumption. The index ended at 77505.96 after soaring 494 points to touch a high of 77899.05. During intra-day trades, it hit a low of 77006.47, thereby gyrating 892.58 points. The NSE Nifty dipped 26.25 points to settle at 23482.15. In intra-day trade, the benchmark scaled a high of 23632.45 and a low of 23318.30.
The tepid reaction of the investing community to the budget came as Sitharaman upped the capex target by only 10.08 per cent to ₹11.21 lakh crore for 2025-26, which fell below expectations. It also led to concerns that India’s economic growth would remain subdued in the absence of a major push in spending from the Centre. The capex number dashed hopes of sectors such as infrastructure, defence and the railways that have a heavy influence on the market. All these segments witnessed heavy selling.
However, Sitharaman’s proposals on the tax front led to sectoral indices such as FMCG, auto, realty, consumer discretionary and consumer durables ending on the higher ground over optimism that more money in the hands of people would lead to increased demand for these items.
“The market has responded to the budget with a mixed view, primarily due to the modest 10 per cent year-on-increase increase in capex for 2025-26. Sectors like railways, defence and infra are affected on which the market relies for the performance, dampening the sentiment,” Vinod Nair, head of research at Geojit Financial Services, said.
He added that consumption-based sectors, which were expected to benefit the most, had a low effect on the market owing to their modest market mix position.
An analyst with a foreign brokerage here pointed out that investors should now look at rejigging their portfolios and include consumption stocks if they were available at reasonable valuations.
Amisha Vora, chairperson and managing director of PL Capital, said the budget would be positive for consumer durables, travel, tourism, auto, jewellery, delivery and e-commerce sectors. “In 2025, investors will make money, albeit at a slower pace. Right stock picking will be key to creating wealth. While factors like Trump’s policy moves, the Fed’s interest rate decisions and currency outlook will be important determinants of market moves, I believe the budget has done its job well,” she added.
