Budget 2026 rocks markets: Sensex crashes 2,300 points, Nifty plumps 600 points

Mumbai (The Uttam Hindu): While presenting the Union Budget 2026, Finance Minister Nirmala Sitharaman made a major announcement related to the Indian stock market, due to which there was an uproar in the domestic market and the Sensex fell by 2,300 points.

Indian stock markets fell sharply on Sunday after Finance Minister Nirmala Sitharaman presented her ninth consecutive Union Budget. The market witnessed significant volatility on Budget Day.

The Sensex tumbled more than 2,300 points from its day's high on Sunday, while the Nifty fell more than 600 points. Investors appeared cautious after the budget, adding to market pressure.

In fact, in his budget speech, the Finance Minister announced an increase in the Security Transaction Tax (STT) on futures and options (F&O) investments, raising the STT on futures to 0.05%. Following this announcement, the market experienced a significant decline. Despite the budget's commitment to accelerating economic growth and maintaining fiscal discipline, the stock market still declined.

The stock market opened flat on Sunday. The Sensex opened a few points higher, while the Nifty was slightly lower. Caution about the budget and the rupee's weakness against the dollar (around 92 rupees per dollar) weighed on the market.

Most sectoral indices opened with losses. Nifty Metal was the biggest loser, falling over 3 percent. Auto, private bank, oil and gas, and consumer durables stocks saw modest gains.

Bharat Electronics was among the top Nifty gainers. Investors expected more funding for the defense sector in the budget, leading to buying in the stock.

According to market experts, the main reason for this decline is investor caution. They had expected significant income tax relief in the budget, but given the already significant tax cut in 2025, no major announcements were made this time around.

Small changes to the tax system and measures aimed at long-term growth were seen as positive, but were not enough to stop the initial sell-off in the market.

Analysts said investors are likely to remain interested in defense-related stocks and manufacturing export companies, while also keeping an eye on announcements related to mergers of PSU banks and government stake disinvestment.

According to experts, the market is expected to remain volatile throughout the day. This will depend on budget announcements, capital expenditure, sector relief, and the fiscal deficit target. The fiscal deficit for fiscal year 2027 is estimated to be around 4.3 to 4.4 percent of GDP.

Trading in the stock market will continue till 3:30 pm, but shares purchased on January 30 will not be able to be sold today due to settlement holiday.

Analysts say investors are closely monitoring the government's debt, deficit figures and borrowing plans for the coming year to understand its future economic strategy.