Mumbai, Feb. 1 -- The benchmark equity indices witnessed a sharp sell-off during the special trading session on Sunday following the presentation of the Union Budget 2026 by Finance Minister Nirmala Sitharaman. While the speech remained broadly market-friendly at the macro level-maintaining the fiscal deficit glide path at 4.4% in FY26 and 4.3% in FY27, raising capital expenditure to around Rs 12.2 lakh crore, and reiterating a declining debt-to-GDP trajectory-the positives were overshadowed by a key negative for markets.

The sharp increase in Securities Transaction Tax on derivatives emerged as the primary trigger for the sell-off. STT on futures was raised from 0.02% to 0.05%, while the levy on options was increased to 0.15%. The move ...