A booster shot for bulls in best budget day rise

MUMBAI: Indian stocks rallied 5% on Monday propelled by the government’s plan to ride the economy out of the pandemicinduced turbulence through a slew of growth-focused initiatives as well as the absence of any negative step such as higher taxation.

After a week of nervousness, when the markets consecutively closed in the negative territory, the BSE Sensex lifted 5%, while the benchmark Nifty gained 4.74% as investors cheered announcements made by finance minister Nirmala Sitharaman in the FY22 budget to spur growth through higher public expenditure, asset monetisation and strategic divestments.

The Nifty Bank rose 7%, its highest single-day jump ever, after the finance minister announced measures to clean up bad loans in the sector, which include creating a bad bank to warehouse the bad loans of banks, recapitalisation of ailing

This is not a populist budget. It prioritised growth over fiscal prudence... Markets have loved it PRABHAT AWASTHI, Nomura India head

public-sector banks and privatisation of at least two such banks. The Nifty Auto index rose more than 4% after the government announced the long-awaited voluntary vehicle scrappage policy.

Markets experts said investors were enthused by the absence of any significant negative surprises in the form of higher levies or taxes and the government had done well in setting aside fiscal consolidation concerns to boost nascent growth. “Growth oriented budgets will support equity markets. Asset monetisation, strategic divestment, auto scrappage policy are positive,” said Nilesh Shah, group president and MD, Kotak Mahindra Asset Management Company.