Indian equity benchmarks came under heavy pressure after Finance Minister Nirmala Sitharaman’s Union Budget 2026 speech, with investors turning cautious amid a combination of higher borrowing numbers, a fiscal deficit slightly above expectations and changes in market-related taxes. PSU-linked, metal, financial and consumer stocks dominated the list of top losers, while only a handful of defensive names stayed marginally in the green.
At 12:32 pm, the Sensex was down 1,575.2 points, or 1.9 percent, at 80,694.6, while the Nifty shed 521.9 points, or 2.1 percent, to 24,798.8. Market breadth deteriorated sharply, with 2,247 shares declining against just 1,407 advances.
The risk-off reaction followed Budget announcements that pegged the fiscal deficit for FY27 at 4.3 percent of GDP -- slightly above market expectations -- and projected gross market borrowings at Rs 17.2 lakh crore, higher than estimates. Net market borrowing at Rs 11.7 lakh crore broadly met Street expectations. Volatility also rose after the government proposed taxing share buybacks as capital gains across shareholder categories and announced a hike in securities transaction tax (STT) on futures.
Losses on the Nifty were led by Bharat Electronics, which tumbled 10 percent, emerging as the top laggard. Banking and financial stocks saw steep cuts, with State Bank of India sliding nearly 8 percent and Shriram Finance down close to 5 percent.
Metal stocks remained under pressure, tracking broader weakness, with Hindalco Industries falling over 6 percent and Tata Steel shedding more than 4 percent. Consumption- and tech-linked names such as Eternal, HCL Technologies, Tata Consumer Products and Bajaj Finance also featured among the top losers, down between 4 percent and 5 percent.
Gains were scarce and confined to a few healthcare stocks. Max Healthcare Institute rose about 1 percent, while Sun Pharmaceutical Industries and Dr Reddy’s Laboratories traded marginally higher.
Sectoral indices reflected a clear risk-off mood. Nifty Metal dropped nearly 5 percent, while Nifty PSU Bank slumped about 6 percent. Realty, energy, auto, midcap and smallcap indices also saw deep cuts, with broader markets underperforming the benchmarks. India VIX surged more than 16 percent, signalling a sharp jump in volatility as investors digested the fiscal and market-related signals from the Budget.
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