Opening bell: Indian market indices opened substantially higher on Friday, a day after the federal government signaled its intention to pursue budget austerity even as the general elections approached. In addition, strong indications from other Asian counterparts boosted stocks in India. At the opening bell, the Sensex was at 72,189.10 points, up 543.80 points or 0.76 percent, while the Nifty was at 21,867.95 points, up 170.50 points or 0.79 percent.
Of the Nifty 50 firms, 42 climbed while the remaining 8 sank. All of the widely monitored Nifty sectors indices were up, except Nifty auto, which was modestly lower. The government set the fiscal deficit for the fiscal year 2024-25 at 5.1 percent of the gross domestic product (GDP). In the preceding fiscal year 2023-24, the initial fiscal deficit target was 5.9 percent of the GDP, later revised downward to 5.8 percent. The administration wants to reduce the fiscal deficit to less than 4.5 percent of GDP by fiscal year 2025-26. At a post-budget press conference, Finance Minister Nirmala Sitharaman said the government is on pace to follow the glide path it set for 2021-22.
Fitch Ratings stated that the government, in an election year, displayed a strong commitment to a gradual fiscal consolidation path by revising the fiscal deficit for the current fiscal year 2023-24 from 5.9 percent to 5.8 percent. Furthermore, as promised and for the benefit of citizens, the central government made no changes or imposed any new taxes on them. Domestic investors were also pleased with this outcome.
Opening bell: Nifty surpasses 21,800, Sensex gains 500 points.
The interim budget, tabled on Thursday, will meet the financial needs of the interim period until a government is established following the Lok Sabha elections when the new government will propose a comprehensive budget in July. On Budget Day, Indian market indices went up and down before settling modestly lower. Analysts had speculated that the indices’ poor performance could be attributed to the Budget document’s lower-than-expected capital expenditure markup and the US Fed’s imprecise advice on relaxing monetary policy. Some, however, attributed it to modest profit booking.
The larger market indices, the Sensex and Nifty, were in the green at the start of the day, but as the day went on and the budget was presented, they edged into the red.
