Thursday, 26 January 2017

Budget expected to be market-neutral: Morgan Stanley

Morgan Stanely

Union Budget - The Union budget is going to be a "market-neutral" event as policymakers are not likely to change their policy stance and will continue to focus on fiscal consolidation, says a Morgan Stanley report.

"We do not expect major changes in the conduct of fiscal policy and hence, view the budget as a market-neutral event," Morgan Stanley said in a research note.

The Union budget for 2017-18 is due to be presented on February 1.


According to Morgan Stanley India Strategist Ridham Desai, the budget's influence on short-term market performance is declining.

"Market participants will have to deal with a fair amount of volatility on the budget day though even this volatility has been declining over the past 25 years," Desai said.

Sector-wise, the budget is expected to be positive for autos, cement and metals, consumer, Internet and e-commerce, media and real estate.

For sectors like financials, information technology, oil and gas and utilities, budget proposals are expected to be neutral.(Read More)

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