Finance minister Nirmala Sitharaman disappointed Dalal Street investors with her second Budget as she shifted the burden of dividend tax from corporates to recipients that will hurt promoters, didn’t give in to expectations of abolishing long term capital gains tax on equities and raised fiscal deficit targets that is expected to keep rate of interest at an elevated level. As a result, the sensex crashed 988 points__the biggest single-session points drop on a Budget day__to close at 39,736, a three-month closing low. The day’s sharp dive in the market also left investors poorer by Rs 3.5 lakh crore with BSE’s market capitalisation now at Rs 153 lakh crore.In Saturday’s session, HDFC group was hit the sharpest since market players say tough time for financial sector firms if the rate of interest remains sticky. In addition, insurance and mutual fund companies were hit by the FM’s proposal to do away with IT exemptions for individuals in favour of lower income tax rates. HDFC, ITC, ICICI Bank and HDFC Bank contributed the most to the sensex’s slide while higher closing for TCS, HUL and Infosys cushioned the fall marginally.The FM, however, changed some rules which are expected to enthuse foreign funds to invest in India. According to Rashesh Shah, Chairman & CEO, Edelweiss Group, the FM has sent out a very positive signal to foreign investors through exemptions to sovereign wealth funds to invest in infrastructure and the abolition of dividend distribution tax, “to reaffirm their faith in the India growth story.” Institutional dealers too feel that with central banks readying to pump in cash to revive a slowing global economy, FPIs are expected to continue to buy into the India story.On the other side of the spectrum, market’s expectations about strong fiscal and other measures to bring the economy back on track, were not met. “The proposed listing of LIC (the government-owned largest life insurer in India), abolition of dividend distribution tax are positives but markets were hopeful of fiscal measures to kick start the economy and the Budget fell short on this count,” said Raamdeo Agrawal, chairman, Motilal Oswal Financial Services.The day’s selling was across the board with BSE’s midcap and smallcap indices, both closing 2.2% lower. Among the sectoral indices, real estate, capital goods and industrials losing the most with IT and Teck indices closing with marginal gains. The session also recorded a net foreign fund outflow of Rs 1,200 crore while domestic funds were net buyers at just Rs 37 crore, BSE data showed.