Indian stocks recover from Budget day losses, Sensex up over 500 pts
Feb 02, 2024
New Delhi [India], February 2 : Indian stock indices kicked off Friday's session sharply higher, a day after the central government showed its intent that it was aiming for fiscal consolidation even as the General elections are around the corner.
Also, firm cues from other Asian peers lent some support to stocks back here in India.
At the opening bell, Sensex was at 72,189.10 points, up 543.80 points or 0.76 per cent, and Nifty at 21,867.95 points, up 170.50 points or 0.79 per cent.
Among the Nifty 50 companies, 42 advanced and the rest 8 declined. All the widely-tracked Nifty sectoral indices, but Nifty auto which was marginally lower, were in the green.
The government pegged the fiscal deficit for 2024-25 at 5.1 per cent of gross domestic product (GDP). In 2023-24, the government pegged the fiscal deficit target for 2023-24 at 5.9 per cent of gross domestic product (GDP), which was downwardly revised to 5.8 per cent yesterday.
The government intends to bring the fiscal deficit below 4.5 per cent of GDP by the financial year 2025-26. Finance Minister Nirmala Sitharaman, at a post-Budget presser, said the government is on track to meet the glide path that it had set in 2021-22.
"The government revised its current FY24 fiscal deficit to 5.8 per cent from 5.9 per cent, demonstrating a firm desire to adhere to a path of gradual fiscal consolidation even amid an election year," Fitch Ratings said.
Further, as expected and for relief to citizens, the central government neither tweaked nor put any additional tax burden on them. This too bore well for the domestic investors.
The interim budget, tabled on Thursday, will take care of the financial needs of the intervening period until a government is formed after the Lok Sabha polls after which a full budget will be presented by the new government in July.
On Budget Day, Indian stock indices took a rollercoaster ride and settled marginally in the red. Analysts had said dampening performance in the indices could be due to below-expected capital expenditure markup in the Budget document and the US Fed's unclear guidance on loosening the monetary policy stance. Some, however, attributed it to mild profit booking.
The broader market indices, Sensex and Nifty, were in the green at the opening bell, but as the day progressed and with the tabling of the budget, they edged towards the red.
