The Indian stock market saw a dramatic decline following the presentation of the Union Budget 2024. The BSE Sensex fell by more than 1,150 points, and the NSE Nifty dropped below the 24,150 mark. As of 12:36 pm, the Sensex was down 1,178 points, or 1.46 percent, bringing it to 79,324 points.
Similarly, the Nifty was down 382 points, or 1.56 percent, settling at 24,127 points. This sharp drop resulted in the loss of approximately ₹8.8 lakh crore in investor wealth.
The decline in the equity markets came immediately after Finance Minister Nirmala Sitharaman finished her Budget speech. A key factor contributing to the market's plunge was the increase in long-term capital gains (LTCG) tax, which rose from 10 percent to 12.5 percent.
Additionally, the short-term capital gains tax was raised from 15 percent to 20 percent. These tax hikes were seen as a negative development by investors, leading to widespread selling.
The stock market's fall was led by significant drops in banking, financial, real estate, and energy stocks. Prominent companies such as Reliance Industries Ltd (RIL), Larsen & Toubro (L&T), HDFC Bank, ICICI Bank, State Bank of India (SBI), Bajaj Finance, Bharti Airtel, and PowerGrid experienced declines, contributing to the overall downturn. The Sensex's heavyweights, like Reliance, L&T, and ICICI Bank, alone accounted for a 423-point fall in the index.
Investor wealth, as indicated by the BSE market capitalization, decreased sharply by ₹8.85 lakh crore, falling from ₹448.32 lakh crore to ₹439.46 lakh crore. This decline reflects a significant reduction in the overall value of the stock market, affecting numerous investors and stocks.
Today, 31 stocks hit their 52-week lows, including BSE allcap stocks like Aptech Ltd, Landmark Cars Ltd, Repro India Ltd, and TruCap Finance Ltd. Despite the overall market downturn, 137 stocks reached their one-year highs. Out of a total of 3,917 stocks traded, 2,865 declined, 932 advanced, and 120 remained unchanged.
Several stocks saw significant losses, with shares of The New India Assurance Company Ltd, IRFC, IRCON International, HUDCO, RCF, RVNL, Jupiter Wagons, Vedanta, NHPC, Vodafone Idea, and NBCC (India) falling by up to 7.35 percent. On the NSE, 15 out of 16 sub-indices experienced declines, with the Nifty Bank, Nifty Financial Services, Nifty Realty, and Nifty Oil & Gas sectors facing the sharpest drops.
The market's response to the Budget highlights the impact of policy changes on investor sentiment and market stability. The combination of increased taxes and the broader economic implications have caused considerable anxiety among investors, leading to the substantial sell-off seen today.
As the financial community absorbs the details of the Budget and its potential effects on the economy, the coming days will be crucial in determining the market’s recovery and future direction.
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