Stock Market: Bulls stroll on metal court; indices warm up to Budget

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By S Jha

New Delhi, January 2: Finance Minister Nirmala Sitharaman will be presenting the much awaited final full Budget of the Narendra Modi-led NDA government at the Centre on February 1, while the Economic Survey will be tabled a day before in the upcoming session of Parliament.

Political commentators will bet on a populist Budget to set the tone for the 204 Lok Sabha elections. But Modi watchers are of the views that the Prime Minister has taken out the populist measurers already out of the Budget purview. This is to the liking of the stock markets, for the equity investors dislike the government playing tricks with key areas such as fiscal deficit and the willingness of the government to step up public investment.

The current account deficit is at a record high on account of the exports slow down. But the government will be comfortable with falling crude oil prices and also the emerging scope to import the cheaper Russian oil. This may help the Finance Minister to not shock the market participants on the Budget Day.

The domestic institutional investors have already been warming up to the Budget after having pumped in a net of over Rs 24,000 crores in the equities in December. On the first trading day of 2023, the DIIs again brought in a net of Rs 743 crores, while their foreign counterparts after withdrawing over Rs 14000 crores again pulled out Rs 213 crores. It has already been seen that the DIIs have blunted the negative impact of the FIIs in the market.

The bulls on Monday strolled on the Dalal Street by riding the metal pack. Tata Steel, which had given a false breakout last month, seemingly sought to breakout again. It led the indices by gaining over five per cent. Tata Steel has been in a consolidation stage for several months, and the market participants are waiting for it to convincingly breakout of the trading range to begin rising further. Hindalco and JSW Steel gave a strong company to Tata Steel. The metal pack is seemingly in the bullish stage ever since China abandoned its ‘Zero Covid Policy’.

Motilal Group came out with a report, suggesting that ONGC will be the stock of the year in 2023. The oil and gas behemoth has been a laggard for several years. But 2022 was the year of the PSU stocks, and ONGC is being keenly watched out by the traders for the direction. It got a strong company by Reliance Industries, which lifted the indices after the bears sought to enter the trading ring.