Nifty, Sensex Likely to Open on a Positive Note After Budget-Led Sell-Off

Pre-Market Update at 7:51 AM: Indian equity benchmark indices Sensex and Nifty 50 are expected to open higher on Monday, snapping the sharp sell-off seen during Sunday’s special trading session. However, market volatility is likely to remain elevated as investors continue to digest the implications of Union Budget 2026, particularly the proposed hike in Securities Transaction Tax on futures and options trading.

On Sunday, the Indian stock market witnessed a sharp decline after the Budget announcement. The Sensex plunged 1,546.84 points or 1.88 per cent to close at 80,722.94, while the Nifty 50 dropped 495.20 points or 1.96 per cent to settle at 24,825.45.

Asian equity markets traded mixed on Monday ahead of China’s factory activity data. Japan’s Nikkei 225 rose 0.13 per cent and the Topix gained 0.52 per cent, while South Korea’s Kospi declined 2.5 per cent and the Kosdaq plunged 3 per cent. Hong Kong Hang Seng index futures indicated a lower opening.

Gift Nifty was trading around the 24,902 level, commanding a premium of nearly 49 points over the previous close of Nifty futures, signalling a higher opening for domestic equity indices.

U.S. stock markets ended lower on Friday after investors reacted to U.S. President Donald Trump’s nomination of former Federal Reserve Governor Kevin Warsh, which was perceived as a hawkish move. The Dow Jones Industrial Average fell 179.09 points or 0.36 per cent to 48,892.47, the S&P 500 declined 29.98 points or 0.43 per cent to 6,939.03, and the Nasdaq Composite dropped 223.30 points or 0.94 per cent to close at 23,461.82.

For the week, the S&P 500 rose 0.3 per cent, the Dow slipped 0.4 per cent, and the Nasdaq fell 0.2 per cent. On a monthly basis, the S&P 500 gained 1.4 per cent, the Nasdaq advanced 0.9 per cent, and the Dow Jones climbed 1.7 per cent.

Japan’s manufacturing activity expanded at its fastest pace in nearly three-and-a-half years in January. The S&P Global Japan Manufacturing PMI rose to 51.5 from 50.0 in December, marking its strongest reading since August 2022.

Japanese government bonds declined, pushing yields higher. The 20-year Japanese government bond yield rose 2.5 basis points to 3.2 per cent, while the five-year yield climbed 2.5 basis points to 1.680 per cent.

In the currency market, the U.S. dollar index steadied at 97.22 after jumping 1 per cent on Friday. The Japanese yen weakened 0.4 per cent to 155.39 per USD. The euro traded at USD 1.1848, while sterling slipped 0.05 per cent to USD 1.3680.

Gold prices extended their decline amid a firm U.S. dollar, while silver recovered from recent lows. Spot gold fell 1.5 per cent to USD 4,793.97 per ounce, while U.S. gold futures for February delivery rose 1.6 per cent to USD 4,818.10 per ounce. Spot silver gained 1.6 per cent to USD 85.98 per ounce.

On the domestic market, MCX gold for April futures ended lower by Rs 4,242 or 2.87 per cent at Rs 1,48,104 per 10 grams. MCX silver for March expiry hit a 9 per cent Lower Circuit, closing at Rs 2,65,652 per kg, down Rs 26,273.

Crude oil prices declined by over USD 1 per barrel after U.S. President Donald Trump said Iran was “seriously talking” with Washington. Brent crude futures fell 2.7 per cent to USD 67.48 per barrel, while U.S. West Texas Intermediate crude slipped 2.8 per cent to USD 63.41 per barrel.

For today, Sammaan Capital will remain on the F&O ban list.

Disclaimer: The article is for informational purposes only and not investment advice.