But as the budget was presented and its implications absorbed, the market recovered, hesitantly at first before racing ahead to a peak of 3,400 points at 15.30 hours. Sinha has avoided tinkering too much with excise duties beyond rationalisation. In fact, he unfolded a strategy which was just as was detailed by this writer in the undercurrent column on Saturday. This gave a boost to the FMCG stocks which perked up on the bourses.

The research incentives proposed reversed the trend in pharma stocks firmly. The infotech sector was left undamaged in the budget, leading to an outburst at Infosys and other software counters. Last but not the least, the auto sector also joined the rally as there wasno tinkering with excise duties in any damaging fashion. In fact, even Telco firmed up, despite the proposed increase in diesel levy. Refinery stocks went down as hopes failed to materialise for this sector. Hindalco, too, joined this group. Cement stocks, on the other hand, looked as demand for housing is expected to move up.

The Sensex, which fluctuated by as much as 186 points, reflected the risks and opportunities that market participants faced on budget day. The Sensex closed the session at 3,400 points. The resistance level is seen in the 3,400-3,410 region. The immediate previous significant high was 3,515 points on January 11. But that was a one-day wonder. The 3,400 level is more relevant. If the Sensex manages to break through the 3,410 level, it will face some resistance at 3,461 points, and thereafter a more formidable resistance at 3,515 points. The foreign fund managers were on a holiday on Saturday. If their buying helps clear these resistances, the real resistance for Sensex will be at3,645 points.

The S&P Nifty Index faces a technical resistance at 986 and thereafter at 1,016 points. If the Nifty manages to break these levels it will face a stronger resistance at 1,057 points.