Indian equity markets traded lower in mid-day trading on Thursday following the Union Budget announcement, with both benchmark indices showing modest declines.

The BSE Sensex dropped 182.98 points or 0.24 per cent to 77,317.59, while the Nifty50 fell 66.10 points or 0.28 per cent to 23,442.30 as of 12.30 PM.

Auto and FMCG stocks emerged as the top performers, with Maruti Suzuki leading the gainers’ pack, surging 6.05 per cent. Other notable gainers included retail major Trent, which climbed 5.82 per cent, followed by FMCG giant ITC advancing 3.75 per cent. Britannia Industries and Eicher Motors also showed strong performance, rising 3.42 per cent and 2.90 per cent respectively.

Infrastructure and energy stocks faced selling pressure, with engineering conglomerate Larsen & Toubro and Bharat Electronics Limited both declining 3.59 per cent. Coal India shed 2.65 per cent, while ONGC and Power Grid Corporation fell 2.34 per cent and 2.15 per cent respectively.

“The Union Budget 2025 has introduced several tax reforms and sector-specific initiatives that are likely to shape market sentiment and economic growth. The decision to forgo ₹1 lakh crore in direct taxes and offer full tax exemption up to ₹12 lakh income under the new regime is expected to boost consumer spending, benefiting sectors such as FMCG, automobiles, and retail,” says Anirudh Garg, Partner and Fund Manager at Invasset PMS.

The broader market showed mixed trends, with the NIFTY NEXT 50 marginally up by 0.04 per cent at 63,150.35, while the NIFTY MIDCAP SELECT declined 0.73 per cent to 11,843.90. Banking stocks remained under pressure as the NIFTY BANK index dropped 0.49 per cent to 49,342.50, and the NIFTY FINANCIAL SERVICES index fell 0.69 per cent to 23,060.60.

Market breadth remained positive with 2,034 stocks advancing compared to 1,676 declines on the BSE, while 172 stocks remained unchanged. The session saw 44 stocks hitting their 52-week highs, while 51 touched their 52-week lows. Circuit filters were triggered for 388 stocks, with 198 hitting the upper circuit and 190 touching the lower circuit.

“India’s growth will come from its people. From skilling hubs and research fellowships to education in Artificial Intelligence and MSME support, the government is investing where it matters,” says Dr. Suresh Ramanathan, Dean at Great Lakes Institute of Management, Chennai.

The markets continue to digest various budget initiatives, including the enhanced Kisan Credit Card scheme, nuclear energy expansion plans, and the establishment of Atal Tinkering Laboratories, as trading continues in the afternoon session. “The increased capital expenditure signals a continued push for infrastructure development, benefitting companies in construction, cement, and steel sectors,” adds Garg.

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