Indian Shares Likely to Open Higher Ahead of Union Budget

Mumbai – Indian equity markets are poised for a robust start in a special trading session scheduled for Sunday, as investors eagerly await the unveiling of the federal budget. Market participants are keenly seeking clear signals on government capital spending plans aimed at bolstering economic growth, alongside potential relief measures for crucial export-oriented sectors currently grappling with the impact of U.S. tariffs. The anticipation surrounding the Union Budget, a cornerstone policy document for the world's fifth-largest economy, is driving positive sentiment. Analysts suggest that a strong emphasis on infrastructure development and other capital expenditure projects could provide significant impetus to various sectors, fostering job creation and stimulating domestic demand. This proactive governmental approach is viewed as essential for sustaining India’s growth trajectory amidst global economic uncertainties. Investors will be scrutinizing the budget for specific allocations towards infrastructure, manufacturing, and technology, which are considered critical for India's long-term economic prosperity. Higher government spending in these areas is expected to create a multiplier effect across the economy, attracting further private investment and boosting corporate earnings. Concurrently, significant attention is being paid to the plight of India's export-oriented industries. These sectors have faced headwinds, particularly due to the imposition of U.S. tariffs, which have impacted their competitiveness in key international markets. The federal budget is widely expected to introduce measures, such as tax incentives, subsidies, or schemes to diversify export markets, to alleviate pressure on these industries and help them regain momentum. Such support is crucial for maintaining India's trade balance and safeguarding livelihoods. The special Sunday trading session, typically a holiday for financial markets, underscores the high stakes involved in this budget announcement. It reflects the government's commitment to transparency and allowing market forces to react immediately to the policy pronouncements. Financial analysts and economists will be dissecting every detail of the budget, looking for fiscal prudence, pro-growth initiatives, and steps to enhance ease of doing business. Beyond capital expenditure and export relief, market watchers are also attentive to potential reforms in taxation, disinvestment targets, and measures aimed at boosting rural consumption. The overall tone and direction set by the budget are expected to influence foreign institutional investor sentiment, potentially driving further capital inflows into Indian equities. The market’s initial reaction on Sunday will offer a preliminary gauge of investor confidence in the government's economic vision and its immediate impact on the nation's financial landscape.