Following are comments from market analysts:

DEAN TURNER, ECONOMIST AT UBS GLOBAL WEALTH MANAGEMENT, LONDON

"The markets were focused on how the Chancellor would pay for all of this.

"The deferred rise in corporation tax shouldn't have caught many by surprise, but the size of the jump to 25% is towards the top end of expectations.

"To ease the blow, the Chancellor offered companies an extremely large tax cut linked to investment over the next two years".

DAVID OWEN, CHIEF EUROPEAN ECONOMIST, JEFFERIES, LONDON

"Pre-announced rise in corporation tax to 25% will may make headlines - but super allowance for business investment is interesting - especially with £100bn of excess cash sitting on the corporate balance sheet (since pre-COVID levels).

"Makes it less likely that the BoE eventually goes negative if this corporate cash ends up being put to productive work.

"£65bn of additional support that he cited in the speech is right at the top end of expectations and increases the odds of the economy opening up strongly, but absence of additional stimulus (public sector investment etc.) will likely be seen as a wasted opportunity.

"However, as ever with this Chancellor - he has a habit of coming back to these issues."  

SAVVAS SAVOURI, CHIEF ECONOMIST AT TOSCAFUND, LONDON

"Those in business whose heads dropped on hearing the Chancellor announce the rise in corporation tax to 25% will have lifted their heads and grinned when they heard super-deduction relief.

"What do you buy on this Budget? UK equities - because I strongly believe the OBR's GDP growth forecast for this year and next will be revised higher".

STEPHEN PAYNE, PORTFOLIO MANAGER, JANUS HENDERSON INVESTORS, LONDON

"This (corporate rate hike) is obviously a direct hit to bottom-line profits and the cash available for companies to distribute to shareholders, but it is not entirely unexpected.

"The 'super deduction' on tax for investment is interesting, with the OBR expecting it to boost business investment by 10%".

ED MOYA, MARKET ANALYST, OANDA, NEW YORK

"Following Brexit, some investors that were betting on UK assets hoped Britain would become a low-tax, lightly regulated economy, Singapore-on-Thames.

"The corporate tax increase in 2023 will derail some of those expectations. The UK economy is expected to have explosive growth in 2022, but then quickly return to trend in 2023 at 1.7%, which is when the economy will face higher taxes."

SIMON HARVEY, SENIOR FX MARKET ANALYST, MONEX, LONDON

"The positive impact the spending pledges has on growth has been somewhat offset by concerns of fiscal consolidation later down the line.

"While we didn't expect Chancellor Sunak to drop the fiscal anchor at today's budget given the fluid nature of the economic recovery at present, the rise in the projected deficit from £164bn to £234bn has stoked the bond market's concerns over the financing of this debt at a time when yields are rising.

"Today's budget hinted at the consolidation efforts expected in the near future, likely in the Autumn budget, with the highly talked about corporation tax increase in April 2023 to 25% being announced - this is earlier and larger than most expected."

VALENTIN MARINOV, HEAD OF G10 FX RESEARCH AT CREDIT AGRICOLE, LONDON

"Chancellor Sunak confirmed earlier reports that the government will start introducing some fiscal austerity measures in an attempt to boost the UK fiscal outlook.

"The UK is thus to become the first major economy to consider such measures.

"While this is a commendable policy if you are a rating agency, for the FX markets this could mean a potential downside risk to growth in H2 2021 and especially in 2022.

"Indeed, a premature withdrawal of the fiscal support for the economy could slow down and even derail the recovery at a time when post-Brexit uncertainty lingers and thus clouds the outlook for the services sector of the economy.

"To the extent that this also makes the BoE more cautious and thus more willing to push against any further tightening of the UK financial conditions, it could also hurt the GBP."

VIVEK PAUL, UK CHIEF INVESTMENT STRATEGIST, BLACKROCK INVESTMENT INSTITUTE, LONDON

"Though continued support remains the right policy prescription for now, the Government also signalled some measures to deal with the sharp rise in debt resulting from its pandemic relief.

"That said, this doesn't herald a return of the austerity seen after the global financial crisis, in our view.

"Low interest rates are providing fiscal breathing room by keeping debt servicing costs low - for now. But the UK has less room for manoeuvre than other Western economies."

RACHEL WINTER, ASSOCIATE INVESTMENT DIRECTOR AT KILLIK & CO, LONDON

"Markets reacted positively to the plans to extend support for individuals and businesses, with sterling strengthening marginally during the early part of the speech.

"The key UK indices remained in positive territory despite the announced increase to UK corporation tax.

"Banking shares are up today, reflecting the Office for Budget Responsibility's upgraded forecasts for the UK economy.

"Housebuilders are among the biggest gainers on the market, as they stand to benefit from the extension to the stamp duty holiday."

($1 = 0.7160 pounds)

(Reporting by Julien Ponthus, Ritvik Carvalho, Joice Alves and Carolyn Cohn; Editing by Catherine Evans)