India's benchmark stock indices extended losses for the third session Tuesday as shares of HDFC Bank Ltd. and Larsen & Toubro Ltd. dragged after India received its final budget for financial year 2025.
The NSE Nifty 50 settled 30.20 points, or 0.12% lower at 24,479.05, and the S&P BSE Sensex ended down 73.04 points, or 0.1% at 80,429.04.
During the day, Nifty fell 1.78% to 24,074, and Sensex declined 1.59% to 79,224.32. The indices witnessed a sharp fall after the Union Government proposed higher taxation on short-term and long-term capital gains in the final budget for the current fiscal.
"From the market perspective, the raising of STCG to 20% and LTCG to 12.5% is a body blow," said Sanjay Sinha, founder of Citrus Advisors.
Investors need to brace themselves for a negative reaction in the short term. In light of all the concerns raised about the hyperactive interest in the Futures and Options segment, it is not surprising that the securities transaction tax on F&O has been raised five times, from 0.02% to 0.1%. Hopefully, this will moderate the frenzy in this space, Sinha said.
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"Mid and small-caps also recovered from the lower levels but not sufficiently to outshine the frontline index. By forming a small red candle with a big lower shadow, the index has tested and defended its strong support of 24,200. We believe that as long as the index holds 24,200, the uptrend will remain intact. On the higher side, 24,800 will continue to act as a strong hurdle," said Aditya Gaggar, director, Progressive Share Brokers Pvt.
Shares of ITC Ltd., Titan Co., Infosys Ltd., NTPC Ltd., and Tata Consumer Products Ltd. cushioned the fall in the Nifty.
HDFC Bank Ltd., Larsen & Toubro Ltd., Reliance Industries Ltd., ICICI Bank Ltd., and Axis Bank Ltd. weighed down the index.
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On NSE, seven out of 12 sectors declined and five advanced. The NSE Nifty FMCG was the top performing sector, as it scaled a fresh high during the session after Budget laid out plans to focus on strengthening agricultural production, storage, and marketing out oil seeds.
The fast-moving consumer goods segment was the top performer of the day, advancing over 2.60%, followed by media and information technology. While real estate and the public sector undertaking banking were the major laggards, Gaggar noted.
The NSE Nifty Realty declined the most.
Broader markets ended lower. The S&P BSE Midcap and Smallcap ended 0.74% and 0.18% lower, respectively.
On BSE, 12 out of 20 sectors declined, and eight advanced. The S&P BSE FMCG rose the most, while the S&P BSE Realty declined the most.
Market breadth was skewed in favour of sellers. Around 2,155 stocks declined, 1,743 stocks rose, and 118 stocks remained unchanged on BSE.
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