Budget Day trading: stock market to stay open, top picks to watch
New Delhi (The Uttam Hindu) – Union Finance Minister Nirmala Sitharaman will present her ninth consecutive Union Budget in the Lok Sabha tomorrow. Significantly, despite February 1st being a Sunday, the stock market will trade throughout the day in light of the budget announcements. The impact of the budget announcements could be felt across various sectors and select stocks.
Key market demands include relief from long-term capital gains tax (LTCG) and securities transaction tax (STT). If the government takes steps in this direction, companies involved in the capital markets could directly benefit.
Capital market and brokerage stocks in focus:
A possible cut in LTCG or STT could see movement in stocks like Motilal Oswal, Groww, Angel One, Anand Rathi, Nuvama Wealth Management and 360 One WAM.
The textile sector
is hoping for relief from the budget, which has been under pressure due to US tariffs. If the government announces tax breaks or export incentives, stocks like Gokaldas Exports, Welspun Living, Arvind, Indo Count Industries, and KPR Mill could benefit.
Will spending on railways and defense increase?
Railway-related stocks are trading below their record levels. The budget is expected to provide higher allocations to the railways and defense sectors. The announcement of new Vande Bharat trains and other infrastructure projects could benefit Titagarh Rail, Texmaco Rail, BEML, RVNL, IRCON, and RITES. IRFC is also expected to receive new financing opportunities. Announcements related to the railway security system 'Kavach' could prove to be significant for stocks like HBL Power, Kernex Microsystems, and Siemens.
Investors will also be keeping an eye on the auto sector, with expectations of increased demand
and potential revisions in pay commissions and increased earnings. Maruti Suzuki, Hyundai Motor India, Tata Motors, Bajaj Auto, Hero MotoCorp, and TVS Motors will be in focus. Announcements related to electric vehicles and charging infrastructure are considered positive for auto companies.
Banks, NBFCs, and insurance companies are also on the radar.
In the banking and NBFC sectors, decisions related to the MSME Credit Guarantee Scheme will be crucial. SBI, PNB, HDFC Bank, ICICI Bank, Bajaj Finance, and L&T Finance could be impacted. In the insurance sector, changes related to tax exemptions could determine the fate of HDFC Life, SBI Life, LIC, and other companies.
Apart from this, announcements related to data centre, housing, real estate, pharma and renewable energy sectors will also play an important role in deciding the market movement.