Local equity markets continued to trade higher

The local equity markets continued to trade higher in the late morning session as the finance minister Pranab Mukherjee started presenting the Budget. Meanwhile, he has made major announcements to each and every sector to boost the economic growth. The government will give 3% interest subsidy to farmers in FY12 and will give infra status to cold storage chains. He proposed to boost infra development tax-free bonds of Rs 30,000 crore. FM has upped FY12 IIFCL disbursement target to Rs 25,000 crore and also the new companies bill will be introduced in current session. On the other hand, other Asian markets were trading mixed and the US index future was trading in flat range. Back home, NSE Nifty and BSE sensex were trading around its psychological level of 5,400 and 18,000 levels respectively. In the BSE sectoral space, Realty, PSU, Oil and Gas, CG and FMCG stock were inching higher, while Auto companies continues to trade negative. The broader markets also mirroring the benchmarks; the BSE Mid cap and Small cap indices were up by 1.50% and 1.38%, respectively. The overall market breadth on BSE is extremely in the favour of advances which have thrashed declines in the ratio of 1747:638, while 85 shares remained unchanged.

The BSE Sensex surged 275.24 points or 1.55% at 17,976.15. The index has touched a high of 17,869.63 and a low of 17,732.38 respectively.

The BSE Mid cap and Small cap indices were up by 1.50% and 1.38%, respectively.

All the sectoral indices on the BSE barring Auto down 0.40 % were trading in green. Realty up 3.04%, PSU up by 2.95%, Oil and Gas up by 2.40 %, CG up by 2.40% and FMCG up 1.79%.

The top gainers on the Sensex were ONGC up 3.48%, HDFC up 3.42%, L&T up by 3.30%%, DLF up 2.89% and Sterlite Industries up 2.69%.

Hero Honda down by 2.42%, Tata Motors down by 1.82%, Hindalco down by 0.97 %, Bajaj Auto down by 0.74 % and Tata Power down by 0.20% were the only losers on the index.

Budget Highlights

• FY12 non tax revenue seen at Rs 1.25 lakh crore
• Multi nutrient based subsidy policy for Urea  
• Rs 21,000 crore allocation towards literacy mission  
• To move insurance, pension and banking bills in parliament  
• To introduce self assessment system in Customs  
• To raise rural infra fund from Rs 16,000 crore to Rs 18,000 crore  
• Banks to cover 2,000 villages for opening accounts in FY12  
• Easier service tax refund for goods exporters  
• To give Rs 8000 crore to J&K for development needs  
• SEZs to benefit from easier service tax refund  
• Rs 6000 crore to enable banks to maintain 8% TIER 1 capital  
• Healthcare sector to get allocation of Rs 26,760 crore  
• To infuse Rs 500 crore in Regional Rural Banks (RRBs)  
• To treat capital investment in fertilizer sector as Infra  
• To give Rs 5000 crore to SIDBI to refinance small firms  
• Mortgage risk guarantee fund for home loans to poor  
• Allocated Rs 58,000 crore for social schemes (Bharat Nirman)  
• Education sector allocated Rs 52,057 crore in FY12  
• To set up institution for tracking black money  
• Allocation for farm development hiked to Rs 7860 crore  
• QFIs allowed in to invest in MF scheme  
• FY12 IFCL disbursement target upped to Rs 25,000 crore  
• Direct cash subsidy on kerosene, fertilizers for BPL  
• PPP model has been positive in Infra projects  
• To raise corpus of rural infrastructure development fund to Rs 180 billion in 2011-12  
• To give 3% interest subsidy farmers in FY12  
• Propose to give Rs 3000 crore to NABARD  
• To set up national mission for hybrid, electric vehicles  
• Propose to introduce tax free bonds of Rs 30,000 crore for infra  
• Current A/C gap a concern due to composition of FX flows  
• To give infra status to cold storage chains  
• Rollout of DTC effective April 1, 2012  
• Increased the credit inflow from Rs 3,75,000 crore to Rs 4,75,000 crore  
• FII allowed to invest in Corporate Infra bonds 
• New companies bill to be introduced in current session  
• Upped priority home loan limit to Rs 25 lakh from Rs 20 lakh  
• Infra sector FII cap for bonds with 5 year residual maturity  
• To bring bill to enable RBI to give more private banking licenses  
• Capital infusion of Rs 20,157 crore in PSU banks in FY12  
• Investment in corporate bonds hiked to $40 billion  
• FIIs allowed to invest in MF schemes  
• Discussion on to further liberalize FDI policy  
• Divestment target at Rs 40,000 crore 

The S&P CNX Nifty advanced 87.95 points or 1.66% at 5,391.50. The index has touched a high of 5,395.85 and a low of 5391.50 respectively.

The top gainers of the Nifty were Reliance Capital up 8.69%, IDFC up 6.16%, Suzlon up 4.33%, BPCL up 4.11% and HDFC up 4.03%.

The top losers of the index were Hero Honda down by 2.60%, Tata Motors down by 2.23%, ACC down by 1.66%, Ranbaxy down by 1.47% and HCL tech was down by 1.10%.

The Asian markets were trading on a mixed note; Shanghai Composite increased 0.79%, Hang Seng surged  0.79%, and Nikkei 225 advanced  by 0.92% and KLSE Composite climbed  0.07% .

On the flip side, Jakarta Composite declined 0.02%, Straits Times shed 0.23% and Seoul Composite trimmed 1.23%.

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