Mon Feb 02 17:30:00 UTC 2026: ### Market Recovers Slightly After Budget-Induced Selloff; Experts Cautious

The Story:

Indian markets are showing signs of a tentative recovery following a significant selloff triggered by investor disappointment with the latest budget announcement and a hike in Securities Transaction Tax (STT) on the Futures & Options (F&O) segment. GIFT NIFTY futures are trading higher, indicating a potential positive start to the trading week. However, technical analysis and options data suggest caution, with a new resistance level forming at 25,000. The NIFTY50 had previously closed below the critical 25,000 psychological mark and its 200-day Exponential Moving Average (EMA) at 25,150, signaling a bearish sentiment.

Key Points:

  • GIFT NIFTY futures indicate a positive opening, up 84 points, after a significant selloff.
  • The NIFTY50 experienced a sharp correction following the budget announcement.
  • Increased STT on F&O trading negatively impacted investor sentiment.
  • The NIFTY50 closed below the 25,000 mark and the 200 EMA.
  • Options data shows the highest open interest on the call side at 25,000, establishing a new resistance.
  • Support is indicated at the 24,500 level, where the highest open interest on the put side resides.

Key Takeaways:

  • Market sentiment remains fragile and is heavily influenced by government policy announcements.
  • Technical indicators suggest the potential for continued volatility.
  • Options data provides insights into near-term resistance and support levels for traders.
  • The hike in STT significantly impacted market sentiment, demonstrating the sensitivity of investors to transaction costs.
  • Immediate recovery is not guaranteed, despite the slight upward movement in GIFT NIFTY futures.

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