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Stocks

Indian stock market still chewing on Modi's first budget

SINGAPORE -- While India's benchmark Sensex was little changed Thursday, investors seemed to be sinking their teeth into the Modi government's first budget proposal.

     The draft budget put forward last week emphasizes infrastructure investment and deficit-cutting as promised.

     To provide financing for infrastructure, banks have been allowed to raise long-term funding free from reserve and liquidity requirements. On the housing front, the government will ease rules for listing real estate investment trusts.

     Shares in infrastructure lender IDFC have been up as much as 18% compared with the day before the draft budget's release July 10. DLF, India's biggest real estate company, has been up to 15% higher.

     Meanwhile, the Oil and Natural Gas Corp. fell around 3% at one point Thursday on word that the government plans to divest 5% of its stake in the energy group in a sell-off of state assets.

     Policy details not covered in the budget proposal are likely to emerge over the next three to six months, reckons Morgan Stanley, so investors may yet find fodder for stock picking.

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