Stock markets: FIIs sell Indian equities worth ₹2,975.31 crore on Budget day

Dalal Street witnessed volatile stock markets on Tuesday after the government proposed to hike securities transaction tax (STT) on futures & options (F&O) trade in the Union Budget for fiscal year 2024-25.

Foreign institutional investors (FIIs) on Tuesday sold stocks of Indian companies worth ₹17,306.08 crore and bought stocks for ₹14,330.77 crore, resulting in funds outflow of ₹2,975.31 crore, according to NSE data.

While domestic institutional investors (DIIs) bought equities worth ₹17,799.44 crore and offloaded shares worth ₹16,380.62 crore, resulting in funds inflow of ₹1,418.82 crore, the exchange data showed.

On Monday, FIIs hadbought Indian equities worth ₹3,444.06 crore.

Union finance minister Nirmala Sitharaman on Tuesday said securities transaction tax will be raised on F&O trade from October 1 to discourage retail investors from investing in the risky instrument.

“It is proposed to increase the rates of STT on the sale of an option in securities from 0.0625 per cent to 0.1 per cent of the option premium, and on sale of a futures in securities from 0.0125 per cent to 0.02 per cent of the price at which such futures are traded,” she said in her Union Budget speech.

She also proposed raising of STCG (short-term capital gains tax) to 20 per cent and LTCG (long term capital gains tax) to 12.5 per cent.

The announcements led to Sensex and Nifty 50 tumbling 1.6 per cent and 1.77 per cent, respectively, in intra-day trade.

However, changes in income tax slabs, tax exemptions and customs duty cuts helped the stock indices recover most of the day’s losses.

Sensex and Nifty

The 30-share BSE Sensex closed down by 73.04 points or 0.09 per cent 80,429.04.

During the intra-day, the BSE benchmark declined by more than 1,200 points. It tanked 1,277.76 points or 1.58 per cent to hit a low of 79,224.32.

The NSE Nifty 50 dipped 30.20 points or 0.12 per cent to end at 24,479.05. Intra-day, it dropped 435.05 points or 1.77 per cent to 24,074.20. Among the Sensex pack, Titan jumped over 6 per cent, followed by ITC which surged more than 5 per cent.

In the broader market, the BSE midcap index fell 0.74 per cent while the smallcap index dropped 0.18 per cent.

Consumer durables and FMCG indices were among the top sectoral performers with a gain of 2.45 per cent and 2.48 per cent, respectively.

Among other sectoral indices, IT rose 0.82 per cent, services added 0.62 per cent, healthcare gained 0.59 per cent and teck added 0.56 per cent.

Realty shed 2.15 per cent, capital goods fell 2.03 per cent, industrials lost 1.48 per cent, financial services lost 1.27 per cent, metal lost 1.02 per cent, commodities lost 0.51 per cent and telecommunication lost 0.51 per cent.