Nifty on B-Day
The Nifty index reacted positively to the budget 2006-07.It touched an all time high of 3090 ,while closing at 3071.95, with a change of 15% over previous day.The Nifty index reacted negatively to proposals like increase in Securities Transaction Tax (STT) and was quoted at the day's low of 3031 at mid-session even as the overall budget was termed as excellent by market players.
The budget also announced measures to boost spending on infrastructure such as roads, ports and airports and cut excise duty on small cars, boosting construction and auto shares.
Shares in top car maker Maruti Udyog Ltd.,rose nearly 6 percent to a record 834.20 rupees after the excise duty was cut to 16 percent from 24 percent.Tata Motors Ltd., India's number three car maker,rose nearly 4 percent to an all-time high of 816 rupees.
The budget proposed to raise service tax rate from 10 to 12 per cent and widen the net to double the collections to Rs 34,500 crore in 2006-07.
The Top gainers on Nifty were BHEL,ACC,Grasim,and Maruti Udyog,while ONGC,HPCL,BPCL and Ranbaxy Labs were the top losers.The Sectors which are seen to be affected by the budget are Handloom,Automobile,FMCG etc
Looking at the budget right now,feels that it is a budget for the long-term investor in the Indian economy.