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Mumbai, February 2 :
Indian stock markets recovered from early losses and traded in positive territory on Monday after opening lower due to selling pressure triggered by the hike in Securities Transaction Tax (STT) announced in the Union Budget.
The Nifty 50 opened at 24,796.50, down 28.95 points or 0.12 per cent. The BSE Sensex started the session at 80,555.68, slipping 167.26 points or 0.21 per cent.
However, both indices soon pared losses. The Nifty gained 0.3 per cent, while the Sensex jumped 372 points in early trade.
Markets Recover on Selective Buying
Market participants remained cautious after the sharp selloff seen post-Budget. Selective buying across sectors helped the benchmarks recover from opening lows.
Banking and market expert Ajay Bagga said that selling pressure may continue in the near term but highlighted several positives in the Union Budget.
“We expect some more selling, with profit booking at every rise. However, Indian markets are in a heavy oversold zone. The Union Budget 2026 reflects a shift toward long-term structural resilience with fiscal discipline and sector-focused growth,” he told ANI.
FII and DII Selling Continues
Data from Budget Day showed continued selling pressure. Foreign Institutional Investors (FIIs) sold equities worth ₹588.3 crore. Domestic Institutional Investors (DIIs) also remained net sellers, offloading shares worth ₹682.7 crore.
Broader Markets and Sectoral Performance
In the broader market, performance remained mixed on the National Stock Exchange.
- Nifty 100 rose 0.13%
- Nifty Midcap 100 fell 0.21%
- Nifty Smallcap 100 declined 0.49%
Sectoral indices also showed mixed trends. Nifty Auto, FMCG, IT, Media, and Pharma traded in the red. Meanwhile, Nifty Oil & Gas and Nifty Metal opened in the green and supported the broader market.
STT Hike Weighs on Market Sentiment
Ponmudi R, CEO of Enrich Money, said markets may remain under pressure following the surprise STT hike on derivatives in the Union Budget 2026–27.
“Futures STT has increased to 0.05 per cent from 0.02 per cent, while options STT has risen to 0.15 per cent. Higher trading costs may impact F&O-heavy stocks and brokerage firms,” he said.
Asian Markets Trade Lower; Gold Slips
Asian markets traded weak. Japan’s Nikkei 225 fell 0.81 per cent, Hong Kong’s Hang Seng dropped 2.4 per cent, and Taiwan’s weighted index declined 2 per cent.
Gold prices continued their downward trend on the MCX. The yellow metal traded at ₹143,321 per 10 grams, down nearly 3 per cent.
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