What did the Market say after Budget 2017!


Feb 02 2017 05:01 PM ,   Nabarupa Kanjilal  , No Comments


BudgetFinance Minister Arun Jaitley presented the Union Budget 2017, his fourth annual budget, yesterday.

 

These are the key points of Union Budget 2017-

  • Agriculture and Farmers’ Welfare: with focus on doubling farmers’ income in five years;
  • Rural Sector: with emphasis on rural employment and infrastructure;
  • Social Sector including Healthcare: to cover all under welfare and health services;
  • Education, Skills and Job Creation: to make India a knowledge-based and productive society;
  • Infrastructure and Investment: to enhance efficiency and quality of life;
  • Financial Sector Reforms: to bring transparency and stability;
  • Governance and Ease of Doing Business: to enable the people to realise their full potential;
  • Fiscal Discipline: prudent management of Government
  • Finances and delivery of benefits to the needy; and
  • Tax Reforms: to reduce compliance burden with faith in the citizenry.

 

The fast moving consumer goods (FMCG) sector is looking forward to a revival in consumer spending after the demonetization of high-value currency notes in November.

India will ramp up spending on the rural areas, infrastructure as well as fighting poverty, Finance Minister Arun Jaitley said as he unveiled his annual budget on Wednesday, 1st February 2017, adding the impact on growth from the government’s cash crackdown would wear off soon.

Addressing parliament, Jaitley termed his fourth budget one for the poor. Yet, while vowing prudent fiscal management, he also raised his 2017/18 federal deficit target to 3.2 per cent of gross domestic product to cover all the spending promises. Jaitley referred to India “an engine of global growth” but highlighted risks to its outlook from likely U.S. interest rate hikes, rising oil prices and signs that globalization is in retreat.

Prime Minister Narendra Modi’s surprised the market with decision last November to scrap high-value banknotes worth 86 per cent of the country’s cash in circulation. This had earlier hit the consumer demand, disrupted supply chains and hurt capital investments.

Any boost to the rural sector will play a crucial role for the FMCG sector in the year 2017. The market may also see an increase in allocation to marquee programmes such as the Pradhan Mantri Krishi Sinchai Yojana, Rashtriya Krishi Vikas Yojana and Pradhan Mantri Gram Sadak Yojana.

Another sector in focus is automobile. January 2017 proved to be a mixed bag for the Indian automotive industry as some manufacturers reported higher sales numbers while some reported flat or lower sales.

However, automakers along with the analysts are optimistic on budgetary announcements aimed to boost the sector.

According to Subrata Ray, Group Head, Corporate Sector Ratings, ICRA Ltd focus on rural economy and infrastructure are two big positives. Continued focus on infrastructure with an outlay at Rs 3.96 lakh crore would be a positive for the commercial vehicle industry.

 

This is What the Major Nifty Indices looks like a Day after the Budget.

 

Sr No Symbol 1D 1W 1M 3M 6M 1Y
Sr No Symbol 1D 1W 1M 3M 6M 1Y
1 NIFTY REALTY INDEX 4.96 3.26 9.18 -7.35 -8.07 25.09
2 NIFTY AUTO INDEX 3.6 2.25 9.27 2.19 7.63 36.43
3 NIFTY FMCG INDEX 3.04 1.31 8.63 6.14 -0.63 17.21
4 NIFTY FINANCE INDEX 2.69 3.52 11.31 2.06 5.34 28.15
5 BANK NIFTY 2.59 2.81 11.41 4.12 7.01 32.87
6 NIFTY METAL INDEX 2.43 1.21 16.32 14.15 30.5 98.71
7 NIFTY MEDIA INDEX 2.27 0.49 8.25 -1.05 0.3 19.04
8 NIFTY 1.81 1.32 6.56 2.38 1.08 16.91
9 NIFTY ENERGY INDEX 0.64 0.76 4.22 8.3 15.53 30.45
10 NIFTY PHARMA INDEX -0.46 -1.38 -1.17 -9.58 -11.91 -10.82
11 NIFTY IT INDEX -1 -4.08 -5.95 -1.23 -12.78 -13.27

 

 

Once the market settles down in about a week’s time, we will understand what effect the H1-b visa modification and other policies of the Trump government will affect Indian market.


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