Indian Stock Market Shows Volatility After Union Budget 2025-26 Announcement

The Indian stock market experienced significant fluctuations on Saturday, February 1, 2025, following the presentation of the Union Budget for 2025-26 by Finance Minister Nirmala Sitharaman.

Initially, both the BSE Sensex and NSE Nifty saw an upward surge after the announcement of tax relief, with no income tax for individuals earning up to Rs 12 lakh. However, the positive momentum was short-lived as both indices quickly dropped into the red. The BSE Sensex lost 455 points, while the Nifty fell by 115 points after the Budget speech.

The Finance Minister’s Budget estimate for the financial year 2025-2026 stands at approximately Rs 31.47 lakh crore.

Sectoral Performance Post Budget

While sectors like FMCG, Auto, Realty, and Consumer Durables showed positive movement, others struggled. The Nifty Metal index suffered the most, falling by 1.94%, followed by Nifty Oil & Gas (-1.93%), Nifty PSU Bank (-1.29%), and Nifty Mid-Small IT & Telecom (-1.29%).

Revised Tax Structure Under the Union Budget 2025-26

One of the key highlights of the Budget was the revised tax regime. The new tax rates are as follows:

• Income up to Rs 4 lakh: No tax
• Income between Rs 4 lakh and Rs 8 lakh: 5% tax
• Income between Rs 8 lakh and Rs 12 lakh: 10% tax
• Income between Rs 12 lakh and Rs 16 lakh: 15% tax
• Income between Rs 16 lakh and Rs 20 lakh: 20% tax
• Income between Rs 20 lakh and Rs 24 lakh: 25% tax
• Income above Rs 24 lakh: 30% tax

Global Market Impact of Budget Announcement

In addition to domestic market fluctuations, global markets also faced pressure. Wall Street indices declined following the announcement by US President Donald Trump regarding tariffs on Canada, Mexico, and China, which are set to take effect on February 1, 2025.

Also Read: Modi Government Announces Significant Increase in Income Tax Exemption Limit in Budget 2025-26

Stay tuned for further updates on market movements and the impact of the Union Budget 2025-26.