Sensex nosedives 290 as Budget 2013 flops; banks hammered

Equity indices crashed to fresh three-month lows Thursday, after the final Budget of  UPA-II fell way short of market expectations. Brokers said the sell-off could have been aggravated because of derivatives expiry, and the liquidity problems being faced by some corporates and traders.

The BSE Sensex shed 290 points to close at 18,861, and the Nifty fell 103 points to end the day at 5693.

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Shares from the power, capital goods and banking sectors were battered the most, as the Budget did not give any clear roadmap as to how economic growth and the investment cycle would be revived.

Among the positives in the Budget, the Finance Minister delivered on the fiscal consolidation and a stable tax regime. But market was expecting much considering that the Finance Minister had marketed the Budget aggressively to foreign investor.

Bank shares, especially public sectors ones, were battered as market viewed the higher agriculture credit target and continuation of interest rate subsidy on short term crop loans and extending it to private sector banks as well, as  negatives. But investment experts said market may have overreacted to these proposals. Yet, if growth does not pick in the coming months, banks could have a serious problem in terms of non-performing assets.

Shares of SBI, PNB, Axis Bank, Bank of Baroda and ICICI Bank fell between 4-6 percent. ADAG stocks were badly hammered today, losing around 8-10%. Out of the pack, Reliance Infra fell 9.3%, Reliance Communication dropped 11.8% while Reliance Industries slipped 2%.

Midcaps continued to get pummeled, with many players suspecting the slide to be triggered by sale of pledged shares/speculative positions that had been created to ramp up the stock price. The BSE Midcap index fell 2.5 percent, and the BSE Smallcap index nearly 2 percent.

Shares of Core Education, which have fallen over 80 percent this week, extended its losing streak, shedding another 9 percent to close at Rs 54.

And while the Budget may have had many announcements for attracting domestic/foreign money into the stock market, none of them appeared solid. Shares from the IT, FMCG and healthcare sectors fared better as investors sought refuge in defensive stocks.

Shares of Nestle India, United Spirits, Titan Industries, GlaxoSmithkline Pharma and Mahindra Satyam gained between 1-2 percent.

Jet Air shares started off on a firm note on hopes that the stake sale deal with Etihad will fructify. However, profit taking trimmed much of the gains and the stock closed marginally higher at Rs 540.

MCX shares rose 1.5 percent as the Commodities Transaction Tax of 0.01 was much lower than what the market had feared.

In the final trading hours, the market got nervous as the ghost of General Anti-Avoidance Rules (GAAR) seemed to make a come-back. In his Budget speech, the Finance Minister proposed that tax residency certificate (TRC) is a necessary criteria for claiming the tax treaty but that will not be sufficient.

F&O expiry also added to the investors' woes today. The Sensex was down 224.25 points or 1.17% at 18928.16, while the Nifty lost 103.85 points or 1.79% at 5693.05. BSE Midcap crashed 2.5% while Bankex slumped 3.7%.

ADAG stocks were badly hammered today, losing around 8-10%. Out of the pack, Reliance Infra fell 9.3%, Reliance Communication dropped 11.8% while Reliance Industries slipped 2%.

Biggest losers on the BSE Sensex are SBI, Tata Steel, ICICI Bank, Tata Steel. Other losers are PNB (down 5.8%), Ranbaxy (down 5%), IDFC (down 5%), Axis Bank (down 4%),  Power Grid (down 4.5%) and Hindalco (down 3%).

However, Titan Industries gained 2% as the FM reduced taxes on gems and jewelrys.

Star of the day was IT sector as the index outperformed the market gaining 0.5%. TCS added 2.1%, Infosys was up 0.3%.

The market has completely shrugged off the Budget proposals presented by the Finance Minister P Chidambaram today. Slipping below 5700, the Nifty has fallen to a three-month low. The Sensex was down 352.93 points or 1.84% at 18799.48, and the Nifty lost 121.70 points or 2.10% at 5675.20.

Top losers on the Sensex continued to be SBI (down 5.1%), Tata Steel, Jindal Steel, ICICI Bank and Maruti Suzuki slipping around 3-4% each. Anil Dhirubhai Ambani Group (ADAG) stocks are getting hammered out of shape. Reliance Communications was down about 8.5 percent. Reliance Infrastructure was down 7.88%.

Vallabh Bhanshali, Chairman, Enam Securities feels that the big disappointment is not spelling out how the current account deficit (CAD) will be dealt with. "Partly, he has said the commerce minister with deal with. Secondly, he has said that as far as gold disincentivising is concerned he is still working out a scheme. I think is a very big area of concern for everyone," he says in an interview to CNBC-TV18.

However, Uday Kotak, Executive VC & MD, Kotak Mahindra Bank thinks that the Budget is therefore good for capital markets, mutual funds, insurance companies. "There is a significant focus and rationalization of many things for these sectors," he adds.

The market continued to sulk post the Budget speech presented by Finance Minister P Chidambaram today. The Sensex was down 170.18 points or 0.89% at 18982.23, and the Nifty lost 60.45 points or 1.04% at 5736.45. BSE Midcap was still down 1.6%.

Top losers on the Sensex continued to be SBI (down 5.1%), Tata Steel, Jindal Steel, ICICI Bank and Maruti Suzuki slipping around 3-4% each. Anil Dhirubhai Ambani Group (ADAG) stocks are getting hammered out of shape. Reliance Communications was down about 8.5 percent. Reliance Infrastructure was down 7.88%.

Vallabh Bhanshali, Chairman, Enam Securities feels that the big disappointment is not spelling out how the current account deficit (CAD) will be dealt with. ''Partly, he has said the commerce minister with deal with. Secondly, he has said that as far as gold disincentivising is concerned he is still working out a scheme. I think is a very big area of concern for everyone,'' he says in an interview to CNBC-TV18.

However, Uday Kotak, Executive VC & MD, Kotak Mahindra Bank thinks that the Budget is therefore good for capital markets, mutual funds, insurance companies. ''There is a significant focus and rationalization of many things for these sectors,'' he adds.

Pressure in the market continued in the last trading hour of the Budget day. The market looked disappointed as the Finance Minister P Chidambaram did not provide many boosters. Also the ghost of General Anti-Avoidance Rules (GAAR) seem to haunt the market now. The government will implement the modified version of GAAR from April 1, 2016, said the FM.

The GAAR aimed at companies and investors routing money through tax havens such as Mauritius, had been scheduled to be implemented from April 2014.

The Sensex was down 154.52 points or 0.81% at 18997.89, while the Nifty lost 56.45 points or 0.97% at 5740.45. The midcap index too lost 1.8%.

Major losers on the Sensex were SBI (down 5.1%), Jindal Steel (4.4%), Tata Steel (down 4.4%) and ICICI Bank (down 4%).

Finance Minister P Chidambaram's Union Budget proposal is not being well received by the market. Soon after the FM's speech, the market started to lose all its gains. The Sensex lost 123.10 points or 0.64% at 19029.31, and the Nifty was down 37.90 points or 0.65% at 5759.00.

There are pockets of weakness in the infra, banks and auto sectors. The midcap index continued to be battered, losing 1.2%. Among the midcaps, Pantaloon Retail was the major loser, slipping 14.3%, ABG Shipyard (down 9.3%) and Suzlon Energy (down 8.2%).

Auto stocks too are reeling under as the FM has proposed to increase excise duty on SUV's from 27% to 30%. Meanwhile STT is reduced from 0.17% to 0.1%. Tata Motors, M&M and Maruti are the biggest losers in the sector.

The market seemed to shrug off Finance Minister's Union Budget proposal that he presented in the Parliament today. The Sensex was down 144.48 points or 0.75% at 19007.93 while the Nifty fell 45.25 points or 0.78% at 5751.65.

Chidambaram has kept his macro promises on the fiscal deficit; he has taxed the rich in a token way, but nothing significant. His revenue take of Rs 18,000 crore is not a big blow for the economy, but this means one can`t be sure how good his estimates are. His assumptions will tell whether his Budget outlays are based on reality or just built on hope and hype. We have to wait for the fineprint to figure out whether he has delivered a clean budget or one with gaping holes and doubtful arithmetic. Given the huge expectations before the budget, Chidambaram has done nothing to rattle the markets or business.

It is a "responsible" Budget, for the simple reason that he has done little for anybody. Compared to expectations, he has delivered a mouse. But that may be better than promising the moon and not delivering.

The FM's proposal that interest subvention on crop loans to continue seemed to be dampner for the banks.

Major losers on the Sensex were the banking stocks including SBI (down 4.1%) and ICICI Bank (down 3.6%). Hindalco (down 3.6%) and Maruti Suzuki (down 3%) too are on the losing side.

Union Budget is a non-event for the market and not worthy of the expectations that P Chidambaram might have stoked in his commentary in the past. There are some irritants for the market. The surcharge has gone up. There is a super-rich tax, bank's convention interest rate subvention will go up which is not very good.So all of these things are irritants.

The Sensex was up 53.45 points or 0.28% at 19205.86, and the Nifty gained 8.10 points or 0.14%

On the other side there are small palliatives like the Securities Transaction Tax (STT) going down on the other hand Commodities Transaction Tax (CTT).

"Barring a couple of small things like a road regulator or the investment allowance which has come in for infrastructure and a very small attempt at getting the savings rate higher. There is no big bang announcement in this Budget which can re-stroke growth and that is what everybody was looking for," says Udayan Mukherjee, Managing Editor, CNBC-TV18.

On other issues on investments and growth, the FM has not made the big announcements which the market was hoping for.

The market is still struggling to gain investors' confidence as the Finance Minister P Chidambaram announced some important duty hikes. The Sensex was down 69.63 points or 0.36% at 19082.78, and the Nifty fell 20.95 points or 0.36% at 5775.95.

However, auto stocks have given a thumbs down to FM's excise duty hike. He has proposed to increase excise duty on SUV's from 27% to 30%. Meanwhile STT is reduced from 0.17% to 0.1%

Tata Motors was quoting at Rs 283.15, down Rs 2.85, or 1.00%. Mahindra and Mahindra lost 0.7%

The FM has increased excise duty on ITC increased by 18%. ITC has fallen 0.4%.

Investors have not liked the FM's way of dealing with taxation this time. Both the BSE Sensex and Nifty have lost majorly now. The Sensex was down 83.21 points or 0.43% at 19069.20, while the Nifty lost 26.25 points or 0.45% at 5770.65.

Here comes the tax blow. Only 42,000 people with incomes of over Rs 1 crore. Surcharge of 10 percent for them. Tax administratin reform commission to be set up. Will raise tax-GDP ratio 11.9 percent. Says time for prudence, restraint and patience. Rates of taxes 10-20-30 percent won' be changed. Level of tax-free threshold to be raised: for 2-5 lakh bracket, tax credit of Rs 2,000 to be given. Rs 3,600 crore revenue loss.

Maruti Suzuki, ICICI Bank, SBI, Jindal Steel and Tata Steel continue to be the major losers on the BSE Sensex.

Holding it firm for sometime, the market seemed to be giving up all its gains. The FM has not allocated any major boosters so far. The Sensex was down 5.80 points or 0.03% at 19146.61, while the Nifty slipped below 5800 at 5792.90 down 4.00 points or 0.07%.

Top losers on the BSE are ICICI Bank (down 2%), Maruti Suzuki (down 1.8%), Tata Steel (1%).

Good news for MF sector! Finance minister allows MF distributors to become members of stock exchanges.

Also, ETFs will be eligible for pension, insurance investments. Insurance and pension companies can directly trade in debt segment, FM announces. Moreover, FIIs can now participate in currency derivative segment. However, the exposure will be subject to forex exposure.

Finance minister says India will follow international best practices for differentiating between FII and FDI.  Importantly, the finance minister is keenly looking into the proposal to amend the SEBI Act to give more powers to the market regulator. The stock exchanges will have a dedicated debt segment.

The market is not showing much movement as the Finance Minister P Chidambaram reads out his Budget allocation for various sectors. The Sensex was up 67.10 points or 0.35% at 19219.51, and the Nifty gained 15.15 points or 0.26% at 5812.05.

Most of the public sector banks gained interest of investors as the FM promised to provide Rs 14,000 cr for public sector bank recapitalisation. He also proposed to launch an all women's bank to be set up via public sector, which will boost PSU banks.

However, the FM's indication that interest subvention on crop loans to continue seemed to be a little dampner for the PSU banks.

Union Bank was up 2.5%, SBI gained 0.2% and PNB was up 0.3%.

Top gainers on the BSE Sensex are Coal India (up 3.3%), BHEL, Wipro,  and L&T.

The market was holding gains as infra stocks boosted the indices. In his Budget speech, Finance Minsiter P Chidambaram spoke of approving Rs 50,000 crore tax-free bonds in FY14. The government expects to raise Rs 25,000 crore via tax-free bonds in FY13.

As per the Budget announcement, IIFCL will give credit enhancement to companies.   Finance minister says infra debt funds will be encouraged going forward.  Interest subvention on farm loans repaid on time will continue, he told the House.

He also added that 3000 KM of road projects will be awarded in first 6 months of FY14.

The Sensex was up 40.79 points or 0.21% at 19193.20 while the Nifty gaiend 10.75 points or 0.19% at 5807.65.

Infra stocks like IRB Infra (up 3%), L&T (up 1.5%) and JP Associates (up 2.6%) are getting investors' confidence.

The market seemed to go mute as the FM divulged details about the expenditure and current account deficit. Finance Minister says FY14 plan expenditure to be 30% more than FY13 revised estimates. FM says FY13 plan expenditure cut to Rs 3.9 lakh crore versus before estimates of Rs 5.9 lakh crore.

The Sensex was up 48.57 points or 0.25% at 19200.98 while the Nifty gained 10.25 points or 0.18% at 5807.15.

Education stocks rallied quite sharply after the Finance Minister P Chidambaram hiked allocation for education programme by 17 percent in Budget.

Educomp Solutions rose 4 percent to Rs 88.30 while Everonn Education gained 5.78 percent to Rs 68.60. CORE Education went up 6.8 percent to Rs 64.40 while NIIT rose 4.44 percent to Rs 24.70. Aptech rallied 5.36 percent to Rs 50.10.

Both the Sensex and Nifty have pared some gains as the Finance Minister P Chidambaram opened his Budget speech. He stressed that greater worry of the country is the current account deficit due to excessive dependence on oil, coal and gold. Chidambaram informed that the ministry will require USD 75 million to finance the CAD in FY14.

The Sensex was up 70.76 points or 0.37% at 19223.17 while the Nifty gained 20.55 points or 0.35% at 5817.45.

Most gainers on the Sensex were Coal India, L&T and BHEL. Losers on the BSE included Maruti Suzuki, GAIL and Dr Reddy's Lab.

Looking for positive reforms in the Union Budget, the market is holding up gains strongly. As the Finance Minister P Chidambaram opened his Budget speech, the Sensex was up 140.59 points or 0.73% at 19293.00 while the Nifty added 41.55 points or 0.72% at 5838.45.

Most gainers on the Sensex were Coal India, L&T and BHEL. Losers on the BSE included Maruti Suzuki, GAIL and Dr Reddy's Lab.

Pankaj Vaish, MD & Head of Markets-South Asia, Citigroup feels that the FM has already done some remarkable things since September. He and his team has not only arrested the freefall but reverse the sentiment, he adds.

"However, our concern is growth slowdown and today they will hopefully deliver a very good Budget because the team is very savvy, sophisticated, they have been on the road including with Citi to Hong Kong and have done a masterful job in talking about the India story and the change in sentiment to global investors," he says in an interview to CNBC-TV18.

The market is gearing up for the Union Budget 2013. The Sensex was up 108.24 points or 0.57% at 19260.65 whilethe Nifty gaines 31.45 points or 0.54% at 5828.35.

Raamdeo Agrawal of Motilal Oswal feels that the finance minister is going to grapple with the weak rupee or external sector imbalance. "I think that is going to be the thrust of Budget and we will see what all proposals are going to come which will tackle this particular problem, That is the fear going on about CTT and there will be a lot of relief rally if it is not there in the Budget," he says in an interview to CNBC-TV18.

Meanwhile top gainers on the Sensex were Coal India, Tata Motors, L&T and BHEL. Losers on the BSE included Maruti Suzuki, GAIL and Dr Reddy's Lab.

Country's largest car maker Maruti Suzuki India moved down 1 percent on Thursday as index provider MSCI will remove the stock from its MSCI India index.

Gujarat Fluorochemicals dropped nearly 4 percent on Thursday as the stock will stop trading in derivatives segment after February expiry.

Ahead of the Union Budget 2013, the market is keenly watching the FM P Chidambaram's moves.  The FM has already arrived for Cabinet meet.
The Sensex added 115.58 points or 0.60% at 19267.99 while the Nifty was up 31.60 points or 0.55% at 5828.50.

Top gainers on the Sensex are Coal India (up 2.7%), Tata Motors (up 2.1%), L&T (up 1.8%) and Sun Pharma (up 1.5%).

According to Raamdeo Agrawal of Motilal Oswal, Chidambaram has the opportunity to make serious policy changes today. As far as expectations, he does not foresee change in excise duty for diesel cars.

Meanwhile, Sandeep Bhatia, Kotak Institutional Equities does not expect any material change in fertiliser subsidy.  "We expect the market to react positively to the Budget," he told CNBC-TV18 in an interview.

Besides, a firming trend in the Asian region, taking a strong lead from Wall Street, which rose on upbeat economic data and the Federal Reserve chief's renewed commitment to loose monetary policy further boosted the sentiment, they said.

Investors are betting big on the Indian market ahead of the Union Budget to be presented by Finance Minister P Chidambaram today. The Sensex was up 110.12 points or 0.57% at 19262.53 while the Nifty gained 30.80 points or 0.53% at 5827.70.

Among the majors, Coal India was the biggest gainer adding around 2.9%.  Others on the gaining side are  Bharti Airtel, L&T, Tata Motors and Sun Pharma.

Jet Airways gained 5.8% at Rs 566 on the BSE. Abu Dhabi-based Etihad announced it has acquired three slots at London's Heathrow airport for USD 70 million (Rs 377 crore) from Jet two from Mumbai and one from Delhi. The deal is part of a sale and lease back agreement, said Etihad.

Strides Acrolab lost 6% (CMP at Rs 924.10 on the BSE) as it announced to sell Agila specialties division to Mylan inc. for USD 1.6bn in cash and potential additional consideration of up to USD 250 million.

Optimistic mood around the Union Budget builds up as the market is making gainful moves. The Sensex was up 102.16 points or 0.53% at 19254.57 while the Nifty gained 27.85 points or 0.48% at 5824.75.

Jet Airways gained 5.20% at Rs 562.65 on the BSE. Abu Dhabi-based Etihad announced it has acquired three slots at London's Heathrow airport for USD 70 million (Rs 377 crore) from Jet two from Mumbai and one from Delhi. The deal is part of a sale and lease back agreement, said Etihad.

Top gainers on the Sensex are ONGC, L&T and Coal India adding more than 2%. On the losing side are Dr Reddy's Labs, Maruti Suzuki and ITC (down around 0.5% each).

Strides Acrolab lost 9% (CMP at Rs 893.95 on the BSE) as it announced to sell Agila specialties division to Mylan inc. for USD 1.6bn in cash and potential additional consideration of up to USD 250 million.

Atul Suri, trader warns that the Nifty may sink to 5500 if the current levels are not hold.  He suggests looking for the next leadership in the market. According to Suri, IT and Oil & Gas may hold the trump card.

As the market approaches the Budget presentation by the Finance Minister P Chidambaram, investors look hopeful. However, the market seemed to be losing early gains. The Sensex was up 128.33 points at 19280.74 while the Nifty gained 35.20 points at 5832.10.

Coal India adding more than 2%. On the losing side are Dr Reddy's Labs, Maruti Suzuki and ITC (down around 0.5% each).

Strides Acrolab lost 9% (CMP at Rs 893.95 on the BSE) as it announced to sell Agila specialties division to Mylan inc. for USD 1.6bn in cash and potential additional consideration of up to USD 250 million.

Atul Suri, trader warns that the Nifty may sink to 5500 if the current levels are not hold.  He suggests looking for the next leadership in the market. According to Suri, IT and Oil & Gas may hold the trump card.

As the Finance Minister P Chidambaram announces the Union Budget today, the market has opened on a good note. However, it is mostly the global cheer that has uplifted the market and Budget expectations will follow soon.

The Sensex was up 165.51 points or 0.86% at 19317.92 while the Nifty was up 49.35 points or 0.85% at 5846.25.

Some analysts feel the market may rally post Budget. Ramesh Damani feels that there is a good probability of market rally post Budget as negatives are already priced into post February correction. He feels that the upside of Nifty is capped at 6500.

The biggest gainers on the Sensex are L&T, Tata Motors, Coal India and ONGC adding around 1.5% each.

As the Union Budget will be announced by Finance Minister P Chidambaram today, market is keenly watching out for the fiscal deficit numbers for the current year. The Finance Minister has already proposed to curb the deficit to 5.3 percent in the current year and 4.8 percent for FY14.

Analyst feel that a disappointing Budget may hit the market badly. Atul Suri, trader warns that the Nifty may sink to 5500 if the current levels are not hold.  He suggests looking for the next leadership in the market. According to Suri, IT and Oil & Gas may hold the trump card.

Meanwhile, Ramesh Damani is positive on the market. He feels that the upside of Nifty is capped at 6500.