Weekly market update, Feb 01, 2026

Indian equity markets even though ended the week with gains, today, budget day, in a rare special Sunday session declined sharply after Finance Minister Nirmala Sitharaman proposed an increase in the Securities Transaction Tax (STT) on derivatives. Reversing the earlier gains, and as compared to previous week closing, The Nifty 50 lost 0.89%, while the BSE Sensex shed 0.78%. The broader market indices outperformed the benchmark indices, BSE 100 Midcap and BSE 250 Smallcap indices gained 0.19% and 1.20% respectively. On the BSE sectoral front, most sectors declined. FMCG was the major loser, down 2.49%, followed by auto and metal, down 2.40% and 1.39%, respectively.

The Budget supports sectors affected by global trade tariffs and focuses on emerging areas of development, including data centres, GCC, semiconductors, biopharma, rare earth elements, and manufacturing. Additionally, it extends support to traditional sectors like textiles, aquaculture, and MSMEs, which have been impacted by global protectionist trade policies. Despite these measures, the market’s reaction has been negative, primarily due to low expectations, limited outlays and the negative bias created by the increased STT for futures.

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