The Indian stock market is open for a special trading session on Budget Day, with trading hours from 9:15 AM to 3:30 PM. Prior to the market opening, the market showed a bullish sentiment with anticipation of the Union Budget 2025-26 presented by Finance Minister Nirmala Sitharaman.
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The Indian stock market is open for a special trading session on Budget Day, with trading hours from 9:15 AM to 3:30 PM. Prior to the market opening, the market showed a bullish sentiment with anticipation of the Union Budget 2025-26 presented by Finance Minister Nirmala Sitharaman.
Key Market Indicators:
Nifty 50 closed at 23,508.40 on Friday (up 1.11%)
S&P BSE Sensex closed at 77,500.57 (up 0.97%)
GIFT Nifty implied a potentially negative start for Saturday morning.
Market Sentiment:
The market is bracing for volatility with a cautiously optimistic outlook. Sectors like IT, auto, and consumer durables have been showing strength. Investors are closely watching the Budget for potential policy signals that could impact market movements.
On January 31, 2025, Foreign Institutional Investors (FIIs) were net sellers, offloading shares worth ₹1,188.99 crore whereas Domestic Institutional Investors (DIIs) were net buyers, purchasing shares worth ₹2,232.22 crore.
Economic Context:
The Economic Survey 2024-25 presented earlier highlighted India's economic resilience, with:
Export growth of 6% in the first 9 months of FY25
FDI inflows increasing 17.9% to US$55.6 billion
Forex reserves at US$640.3 billion.
US Market Overview:
The US stock market experienced volatility on February 1, 2025, driven by several key factors:
Dow Jones fell 450 points, closing below 45,000
S&P 500 ended 0.5% lower but held at 6,000 mark
Nasdaq experienced significant slumpage
Market Tensions:
President Trump announced new tariffs targeting:
- 25% tariffs on Canada and Mexico
- 10% tariff on China
- Potential levies on steel, aluminum, pharmaceuticals, and semiconductors
Global Economic Insights:
The Economic Survey 2025 warns of potential market risks:
US stock market shows elevated valuations
Concerns about concentrated corporate profits in the tech sector
Potential market correction could have cascading global effects
Budget 2025-26 Key Expectations:
- Economic Growth Projections:
- India's economic growth estimated at 6.3-6.8% for 2025-26
- Aim to achieve 7.5-8% CAGR to become a developed country
Tax Reforms
- Potential income tax rate adjustments
- Possible changes in tax slabs
- Potential removal of some tax exemptions
- Considerations for basic exemption limit increase
Key Focus Areas:
- Infrastructure development
- Renewable energy expansion
- Electric vehicle (EV) infrastructure
- Digital infrastructure
- Employment generation
- Startup ecosystem support
Sector-Specific Expectations:
- Boost to manufacturing through PLI schemes
- GST reforms
- Support for MSME sector
- Incentives for domestic manufacturing
- Green energy transition support
Financial Strategy:
- Fiscal deficit target of 4.5% by FY26
- Infrastructure investment estimated at $2.2 trillion
- Emphasis on public-private partnerships
- Attracting domestic and international investments
The budget aims to balance economic growth, fiscal discipline, and inclusive development.