On the day of the Union Budget, several stocks plunged in excess of 5 per cent even as equity benchmark BSE Sensex traded 73.04 points down.
At close, the Sensex was down 73.04 points or 0.09 per cent at 80,429.04, and the Nifty was down 30.20 points or 0.12 per cent at 24,479.
Amid positive global cues, the Indian indices started high but erased all gains and traded flat in the first half.
In the second half, the profit booking dragged the Nifty below 24,100 after the Finance Minister hiked the long-term capital gains tax (LTCG) on all financial and non-financial to 12.5 percent from 10 percent, in the Union Budget for 2024-25. However, the last-hour buying helped it to end on a flat note.
Among the sectors, FMCG, healthcare, media and IT indices were up 0.5-2.5 per cent while bank, capital goods, metal, oil and gas and reality were down 1-2 per cent.
The BSE midcap index shed 0.7 per cent, and the smallcap index ended on a flat note.
On Nifty, the Titan Company, Tata Consumer, ITC, NTPC and Adani Ports were among the top gainers, while losers included L&T, ONGC, Hindalco, Shriram Finance and Bajaj Finance.
Barring Federal Bank, all banking stocks nosedived in the sea of red.
The shares of Axis Bank, ICICI Bank, HDFC Bank, SBI, Bank of Baroda, and IndusInd Bank slipped up to one per cent.
Investors had hoped for announcements regarding the consolidation of government-owned banks, divestment measures, or recapitalisation efforts in pre-budget discussions, but these measures were not addressed.
The multibagger railway stocks experienced a sharp decline due to the Union Budget 2024-2025’s limited focus on the sector.
Ircon International shares plunged 8 per cent to Rs 293.25 apiece, while Rail Vikas Nigam, Indian Railway Finance Corporation, RailTel Corporation of India, and Indian Railway Catering and Tourism Corporation saw declines between 3.3 per cent and 6.2 per cent.
Markets are taking a breather after sky-high valuations and sectoral rotation sparked a heavy tech selloff over the past few sessions.
The Union Budget 2024 has hiked the long-term capital gains tax (LTCG) on all financial and non-financial to 12.5 pr cent from the current 10 per cent. On the other hand, short-term capital gains tax (STCG) on some assets also increased to 20 per cent.
Besides, one should also understand that the exemption limit for long-term capital gains tax has been increased to Rs 1.25 lakh from Rs 1 lakh. This means you can potentially save money on capital gains taxes, even though the LTCG tax rate itself has increased slightly to 12.5 per cent (up from 10 per cent).