Fifteen minutes after interim finance minister Piyush Goyal wrapped up his (first ever) Interim Budget speech for FY2019-20, the equity markets gave a thumbs up as the S&P BSE Sensex touched the day’s high of 36,778.14—a rise of 521.45 points (up 1.44%) over the previous day’s close of 36,256.69 points.

According to Vinod Nair, head of research at Geojit Financial Services, the Interim Budget was watched by the market on a few important points like sops for small farmers, incentives to the common citizen and, if these would be fiscally prudent. “The outcome has been marginally better than expected by the market since it provides a good package considering the upcoming general election, while maintaining rationality in the long term,” says Nair. “For the market, it will provide a good signal in the short term since the interim Budget will not trouble economic accountancy and (the) populist agenda.”

Mumbai-based Jagannadham Thunuguntla, senior vice president and head of research (wealth) at Centrum Broking, says the interim Budget has proved to be “Godly Budget” for Indian middle class. In Thunuguntla’s view, this section has got more than they had anticipated with blockbuster tax-reduction announcements. “This can trigger [a] consumption wave with increased demand for automobile, FMCG, housing and building materials,” says Thunuguntla. “It’s a great effort from [the] Finance Minister balancing prudence and populism,” he adds. Thunuguntla also believes that the farm income scheme should help agri-associated businesses seeing renewed enthusiasm and revive rural demand.

But on the macroeconomic front, the government factoring in a higher-than-anticipated borrowing figure during FY20 could make bond markets somewhat anxious. “However, if the RBI can surprise the markets with a dovish tone in the upcoming monetary policy, this can also be expected to be resolved,” Thunuguntla says.

Ashish Chugh, a Delhi-based value investor and founder of Hidden Gems Advisory, tweeted: “First time someone cared for the middle class and has appreciated the taxpayers.” He said that he would give the Budget a 9 out of 10, which could have been 10 out of 10 if the finance minister had reversed the long-term capital gains (LTCG) tax levied last year and also rationalised the dividend distribution tax, which is too high.

The broader market greeted the interim Budget with a jump of 521 points in the S&P BSE Sensex. The BSE Realty index jumped over 5.58% to reach the day's high of 1,873.12, compared to the previous day’s close of 1,774.09 points, thanks to tax sops and deductions focussed on the real estate sector.

According to Anuj Puri, chairman of ANAROCK Property Consultants, the interim Budget was more or less a vote bank-facing exercise—an electoral pitch that drew attention to past achievements. However, a full tax rebate for earnings up to Rs 5 lakh will give a boost to affordable homes, he says.

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