On Wednesday, it was the absence of bad news that cheered the stock markets more than any significant positive announcement. In the run-up to the Union Budget, market experts were on tenterhooks on the possibility of a change in the long-term capital gains rules that would tax profits on equity transactions. As the speech ended by Finance Minister Arun Jaitley with no mention of a change in these rules, the market heaved a sigh of relief.
A tepid start to the day then changed with the benchmark Sensex ending the day up 1.76 per cent, or 485.68 points, at 28,141.64. The Nifty gained 1.81 per cent (155.10 points) to close at 8,716.4. With the exception of IT and pharmaceutical sectors, all other major sectoral indices closed the day in the green. Nifty Realty stocks, benefiting from the many incentives Jaitley announced for the affordable housing sector, climbed the most, gaining 4.96 per cent at the end of the day. Bank Nifty rose 2.59 per cent to close at 20,020.6.
Oberoi soars 7%Oberoi Realty was the top gainer in the real estate sector, rising 6.94 per cent to close at ₹332.85, followed by DLF, which rose 6.04 per cent, to end the day at ₹143.10. With the multitude of sops for the agricultural sector, agri stocks too had a good day at the bourses. Deepak Fertilizers rose 3.8 per cent to close at ₹259.25, while Jain Irrigation climbed 1.27 per cent to finish at ₹95.80.
In the broader market, the BSE 100 rose 1.9 per cent to close at 8,999.55. The BSE Midcap and Smallcap indices closed up 1.77 per cent and 1.68 per cent, respectively.
Foreign portfolio investors bought net equity worth ₹92.73 crore on Wednesday, while domestic institutions took advantage of the tepid opening to pick up net equity to the tune of ₹1,133.74 crore. Additionally, the Budget proposal to provide exemption to Category I and II foreign investors from taxes on indirect transfers, provided some relief. Retail investors sold net equity worth ₹159.7 crore. Volatility gauge India VIX fell 16.97 per cent to close at 13.97.
Boost to consumption“We feel a slew of measures to boost consumption and no change in the LTCG have gone down well with the markets,” Jayant Manglik, President, Retail Distribution, Religare Securities, said. “The comfortable fiscal deficit target of 3.2 per cent and the proposal to further liberalise the FDI policy also added to the positivity. Put together, things look favourable from hereon. But we advise that (traders) maintain a positive yet cautious approach, considering the overbought market conditions.”