Finance Minister Arun Jaitley proposed to cut the corporate income tax rate to 25 percent for companies with a turnover of upto Rs 250 crore.
Markets witness lot of volatility on the Budget Day. As Finance Minister announces the outlays for different sectors, the stocks advance and decline depending on the likely benefits or drawbacks they expect to derive from the announcements.
The S&P BSE Sensex ended the day 1.76 per cent higher at 28,141.64, gaining 485.68 points while the Nifty50 closed at a crucial level of 8,716.40, up 155.10 points.
The benchmark BSE Sensex opened higher at 27,669.08 and moved in a range of 27,725.16 and 27,590.10 points in morning trade. At 1145 hrs, the Sensex surrendered the gains to trade lower by 4.45 points, or 0.02 per cent, at 27,651.51 points dragged by losses in IT major TCS and Infosys.
"We expect the Budget to spur consumption with a lower tax regime and higher tax-free slabs coupled with higher infrastructure spends," Edelweiss Tokio Life Insurance Managing Director and CEO Deepak Mittal said.
According to Morgan Stanley India Strategist Ridham Desai, the budget's influence on short-term market performance is declining.
"This time market is approaching the Union Budget with very high expectations as this is the first budget after demonetisation. The market perceives the budget as an opportunity to fix the derailment caused to the growth trajectory," India Nivesh said in a report.
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