Sensex skyrockets 2,315 points as market cheers Budget 2021; bank stocks sparkle

MUMBAI: The BSE benchmark Sensex skyrocketed 2,315 points on Monday, propelled by gains in financial stocks, as market participants cheered a growth-oriented Union Budget presented by Finance Minister Nirmala Sitharaman.

After touching an intra-day high of 48,764.40, the 30-share Sensex ended 2,314.84 points or 5 per cent higher at 48,600.61. The broader Nifty soared 646.60 points or 4.74 per cent to finish at 14,281.20.

On the Sensex chart, IndusInd Bank was the top gainer, rallying over 14 per cent, followed by ICICI Bank, Bajaj Finserv, SBI, L&T and HDFC.

On the other hand, Dr Reddy's, Tech Mahindra and HUL were the laggards. Indian markets opened on a positive note tracking positive global bourses.

During the afternoon session, the markets reacted positively to the Union Budget, traders said. All the key market indices witnessed a sharp rise as investors welcomed the big infrastructure and healthcare boost provided in the Budget.

"This is indeed a bold growth-oriented budget. Absence of the much-feared COVID tax and the surcharges on income tax is a great relief. Privatisation of two nationalised banks and proposal of monetisation of assets like land are clear positives," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

"Raising FDI in insurance from 49 per cent to 74 per cent is welcome. Market response to the Budget reflects growth optimism. In brief, the FM has presented a pragmatic, bold and visionary budget in these difficult times," he added.

According to Lav Chaturvedi, ED and CEO at Reliance Securities, the single securities market code announced in the Budget speech will bring about ease of doing business in the Indian financial markets.

This, along with FDI regime and development financial institution, would be transforming for the financial markets, he added.

Sitharaman on Monday proposed more than doubling of healthcare spending while imposing a new agri cess on certain imported goods and raising customs duty on items ranging from cotton to electronics in a bid to pull the economy out of the COVID-induced trough.

She also allocated Rs 20,000 crore to recapitalise state-run banks that are saddled with bad loans and have been a drag on growth.

The revenue target from privatisation of PSUs was put at Rs 1.75 lakh crore with a planned initial public offering (IPO) of Life Insurance Corporation (LIC) among the state-run companies that will be sold in the next fiscal.