The Indian stock market experienced a significant drop, with the S&P BSE Sensex plummeting over 1,000 points to fall below the 80,000 mark, and the NSE Nifty 50 decreasing by more than 300 points to trade at 24,200, as Union Finance Minister Nirmala Sitharaman concluded her presentation of the Union Budget 2024.
The markets turned volatile during Sitharaman’s budget presentation in the Lok Sabha. The 30-share BSE Sensex initially surged when she began her speech but quickly fell into the red and remained flat until 11:41 am.
Similarly, the NSE Nifty initially rose at the start of the presentation but soon encountered volatile trends, ultimately trading nearly 18.25 points lower.
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On the afternoon of July 23, benchmark indices Sensex and Nifty experienced a significant decline, each dropping over 1 percent, following Finance Minister Nirmala Sitharaman’s announcement of increased capital gains tax and higher securities transaction tax (STT) on futures and options (F&O) trading during the 2024 Budget presentation.
The market’s bearish sentiment intensified, affecting most sectors. Broader markets also suffered, with BSE Midcap and BSE Smallcap indices falling by up to 1 percent. Around 873 shares advanced, 2,482 shares declined, and 75 shares remained unchanged. The fear gauge, India VIX, stayed elevated at the 15 level in afternoon trading.
The Budget 2024 raised the short-term capital gains tax on certain financial assets from 15 percent to 20 percent, while the long-term capital gains tax on all financial and non-financial assets increased from 10 percent to 12.5 percent.
Additionally, income from share buybacks will now be taxed at the recipient’s hands, and the STT rate on F&O trading was increased from 0.01 percent to 0.02 percent.
