BREAKING
Revolutionary climate technology breakthrough announced • Championship finals draw record 150M+ viewers • Global markets surge following policy changes • New discovery in quantum computing promises faster processors
The Cliff News
Business

Stock markets rebound in early trade after sharp Budget Day sell-off

What happened: Indian stock markets recovered in early trade after a steep fall triggered by Budget Day announcements. Why it matters: The rebound suggests value...

Feb 2
3 min read
Stock markets rebound in early trade after sharp Budget Day sell-off

  • What happened: Indian stock markets recovered in early trade after a steep fall triggered by Budget Day announcements.

  • Why it matters: The rebound suggests value buying and confidence in long-term growth, despite immediate policy shocks.

  • What changes for people: Investors may see short-term volatility, but blue-chip stocks are showing resilience.

  • Who is affected: Equity investors, mutual funds, foreign institutional investors, and market-linked households.

After a bruising Budget Day sell-off, Dalal Street found its footing on Monday morning. Benchmark indices bounced back in early trade, driven by value buying in heavyweight stocks, even as global cues stayed weak.

What happened

In early trade, the BSE Sensex jumped 302 points to 81,024.94, while the NSE Nifty rose 59.25 points to 24,884.70.

The rebound came a day after markets suffered a nearly 2% plunge during a special Budget Day trading session.

Stocks leading the recovery

Buying interest returned to several blue-chip names.

Major gainers

  • Adani Ports

  • Larsen & Toubro

  • Asian Paints

  • Bharat Electronics

  • Reliance Industries

  • Power Grid

  • HDFC Bank

Stocks under pressure

  • Trent

  • Titan

  • ITC

  • Hindustan Unilever

The rally was selective, indicating cautious optimism rather than a broad-based surge.

What triggered the earlier crash

Markets had reacted sharply to key Budget announcements by Nirmala Sitharaman, who presented a ₹53.5 lakh crore Union Budget for 2026–27.

Key Budget signals

  • Push to boost manufacturing

  • Long-term tax incentives for global data centres

  • Support for agriculture and tourism

  • Continued focus on fiscal consolidation and infrastructure spending

However, a hike in the securities transaction tax (STT) on equity derivatives rattled traders, triggering aggressive selling.

How markets closed on Budget Day

Despite some late recovery, indices ended sharply lower on Sunday:

  • Sensex: Down 1,546.84 points (-1.88%) at 80,722.94

  • Nifty: Down 495.20 points (-1.96%) at 24,825.45

Foreign institutional investors (FIIs) sold equities worth ₹588.34 crore, adding to the pressure.

Global cues remain weak

International markets offered little support:

  • South Korea’s Kospi fell over 4%

  • Japan’s Nikkei 225, China’s Shanghai Composite, and Hong Kong’s Hang Seng were trading lower

  • US markets ended in the red on Friday

Meanwhile, Brent crude slid 4.14% to $66.45 per barrel, reflecting global growth concerns.

Why it matters now

The early rebound suggests investors are separating short-term policy shocks from long-term fundamentals.

  • Budget signals continuity in infrastructure and fiscal discipline

  • Blue-chip stocks are attracting bargain hunters

  • Volatility is likely to persist as markets digest tax and policy changes

The coming sessions will test whether this rebound has staying power.

Bottom line

Indian markets have bounced back from a sharp Budget Day shock, supported by value buying in frontline stocks. But with global markets weak and policy changes still being digested, investors should brace for continued volatility rather than a straight-line recovery.