Sensex, Nifty Trade Higher In Early Deals After Budget Day Selloff

Indian equity benchmarks traded in the green during early deals on Monday, clawing back a portion of the sharp losses seen on Budget Day, despite negative cues from global markets.

As of 09:33 AM, the Sensex was up 373 points, or 0.46 per cent, at 81,096, while the Nifty gained 87 points, or 0.35 per cent, to trade at 24,913.

The broader market underperformed the frontline indices, with the Nifty Midcap 100 declining 0.50 per cent and the Nifty Smallcap 100 slipping 0.85 per cent.

Most sectoral indices were trading in the red. Nifty consumer durables and IT emerged as the major laggards, falling 1 per cent and 0.61 per cent, respectively.

Metal, realty, and oil and gas were the only sectors trading in positive territory.

Key Support and Resistance Levels

Market watchers placed immediate support for the Nifty in the 24,650–24,700 zone, while they identified resistance in the 24,950–25,000 range.

Analysts attributed the sharp selloff on Budget Day to a knee-jerk reaction to the increase in Securities Transaction Tax (STT) on F&O trades. They said the move was not aimed at generating revenue but intended to discourage retail participation in complex derivatives trading, where 92 per cent of retail traders reportedly lost money.

They added that some investors were also expecting changes in the long-term capital gains (LTCG) tax, which did not materialise.

According to analysts, the 10 per cent nominal GDP growth projected in the Budget is achievable and could translate into around 15 per cent earnings growth in FY27.

They, however, cautioned that a meaningful market upturn may take time and could coincide with a retreat from the global AI trade.

Asian markets remained under pressure, with losses across major indices as investors assessed private data on China’s factory activity for January.

China’s Shanghai index fell 1.32 per cent, while Shenzhen declined 1.41 per cent.

Japan’s Nikkei slipped 0.52 per cent, Hong Kong’s Hang Seng Index dropped 2.15 per cent, and South Korea’s Kospi plunged 4 per cent.

US markets also ended mostly lower in the previous session. The Nasdaq declined 0.94 per cent, the S&P 500 eased 0.43 per cent, and the Dow Jones Industrial Average fell 0.36 per cent.

On February 1, foreign institutional investors net sold equities worth Rs 588 crore, while domestic institutional investors were net sellers to the tune of Rs 683 crore.