The indices which were holding firm yesterday and in today's early trades, came down as soon as the finance minister stood up for the budget speech. They recovered through the course of the speech but gave up again later.

The trigger for the decline was the hike in securities transaction tax on all kinds of trades by 25 per cent. Though this was more or less on expected lines, it was as if the markets were waiting for a reason to decline.

• The Sensex is trading lower by 9 points at 10273 at 01.10 PM.
• The Nifty is trading lower by 16 points at 3052.

Losses on the Nifty are much higher because of the decline in ONGC which carries a higher weight on the Nifty.

Most other budget proposals are in line with market expectations. Direct tax rates have been left unchanged. In indirect taxes, peak customs duty has been reduced.

Among the sectors which stand to gain from the budget proposals are passenger cars, man-made textiles, leather goods, diamond exports and food processing.

The increased focus on infrastructure, especially the power sector, is positive for the engineering, capital goods and cement sectors.

The excise duty cut on small cars is powering Maruti, which is trading nearly 3 per cent higher. The company has already announced a cut in retail prices of small cars.

Cement stocks are firm, led by ACC which has gained over 1.5 per cent. Grasim has given up most of its gains as the markets corrected.

BHEL and L&T are the gainers from the engineering sector.

ICICI Bank and HLL are the other gainers.

Stocks of PSU oil marketing companies are the major losers on worries that the indirect tax changes would affect them adversely. Both BPCL and HPCL have lost over 5 per cent each. ONGC has given up nearly 2.5 per cent. Indian Oil has lost over 6 per cent.

Aluminium stocks are weak as the cut in customs duty on non-ferrous metals have been decreased. Hindalco and Nalco are trading with losses of 2.5 per cent each.

MTNL, PNB, SCI, Ranbaxy and Tata Chemicals are the other major losers among index stocks.

Among the mid-caps, stocks of food processing companies have gained after the budget announcement. Agro Dutch and Heritage Foods are among the major gainers.

Jindal Photo, Ansal Properties and Sesa Goa are the other major gainers.

Fertiliser stocks have declined in the absence of any specific announcements. FACT, Chambal Fertilisers, Godavari Fert and GNFC are among the major losers.

Bajaj Auto Finance, Vidoecon Appliances and Softpro are among the mid-cap losers.