Indian Stock Market Braces for Pressure Following Union Budget 2026-27 STT Hike
The Indian stock market is likely to remain under significant pressure in the near term, reacting sharply to the Union Budget 2026-27. The key trigger for this negative sentiment is a surprise increase in the Securities Transaction Tax (STT) on derivatives trading. The government has raised the STT on futures to 0.05% from the previous 0.02%, while the STT on options has been hiked to 0.15% from earlier rates of 0.10% or 0.125%. This substantial rise in trading costs is expected to weigh heavily on stocks with high exposure to futures and options (F&O) activity, as well as brokerage counters.
Market Sentiment Turns Cautious Amid Higher Trading Costs
Ponmjudi R, CEO at Enrich Money, commented on the market outlook, stating, "While domestic institutional investor (DII) buying could offer some support, near-term sentiment remains cautious to mildly bearish. Market participants are reassessing their positions in anticipation of the higher F&O costs, which will come into effect from April 1. The long-term India growth story remains intact, but short-term volatility and correction risks are likely to persist until stability returns." This indicates that investors are adopting a wait-and-watch approach, leading to potential volatility in the coming sessions.
Gold and Silver Rates Rebound After Historic Single-Day Decline
In the commodities market, gold and silver prices witnessed a strong rebound in early trading today. This comes after Friday's dramatic sell-off, which marked the biggest single-day decline for both metals since 1980. COMEX silver prices today opened with an upside gap, touching an intraday high of $87.970 per ounce. Similarly, COMEX gold prices opened higher and reached an intraday peak of $4,905.71 per ounce within minutes of the market opening.
Expert Analysis on Precious Metals' Volatility
Kaynat Chainwala, AVP — Commodity Research at Kotak Securities, provided insights into the recent movements. "Gold and silver suffered their steepest single-day fall since 1980 on Friday, settling at $4,864 per ounce and $84.66 per ounce, respectively. The sell-off was triggered by a sharp rebound in the U.S. dollar, broad-based global market weakness, and the Trump administration's nomination of Kevin Warsh as the next Federal Reserve chair. Warsh is widely regarded as an inflation hawk," she explained.
Chainwala further noted, "This brutal correction followed an exceptional rally. Spot gold had surged to a fresh all-time high of $5,597 per ounce on Thursday, while silver peaked at $121.6 per ounce, buoyed by a softer dollar and persistent geopolitical tensions. Silver saw a deeper correction due to its higher volatility, exposure to industrial demand, and potentially from CME's margin hike announced on Wednesday, January 28. This hike raised non-heightened margin requirements from 9% to 11% and heightened requirements from 9.9% to 12.1%."
USD vs INR: Indian Rupee Consolidates Amid Neutral Bias
Turning to the currency markets, the Indian National Rupee (INR) against the US Dollar (USD) is currently trading within a defined range. Ponmudi R of Enrich Money shared his outlook, stating, "USD/INR continues to trade near the 91.80–92.65 region, holding within its broader ascending structure. However, recent price behaviour indicates temporary consolidation rather than fresh breakout strength. While the higher-high, higher-low structure remains intact, the absence of strong follow-through above 92.20 suggests mild fatigue."
He added, "The 91.40–91.50 zone acts as immediate support. Any sustained dip below this band could reduce currency-led support for MCX bullion, adding pressure during corrective phases. Overall bias remains neutral to mildly bullish, but no aggressive upside confirmation has emerged yet."
Nifty 50 and Sensex Outlook: Volatility to Persist
Shrikant Chouhan, Head of Equity Research at Kotak Securities, provided a technical perspective on the Indian equity indices. "We are of the view that the short-term market texture is volatile, and volatility is likely to continue in the near future. Hence, level-based trading would be the ideal strategy for day traders," he advised.
Chouhan specified key levels, "On the higher side, 25,000 for the Nifty 50 and 81,300 for the Sensex would act as a crucial resistance zone. As long as the market remains below this level, weak sentiment is likely to persist. On the downside, the correction wave is likely to continue till 24,650-24,600 for the Nifty 50 and 80,100-79,900 for the Sensex. Further downside may also continue, which could drag the index till 24,500-24,300 for the Nifty 50 and 79,600-79,000 for the Sensex. On the flip side, above 25,000/81,300, the market could move up to 25,200/81,900 or the 200-day simple moving average."
Bank Nifty Faces Bearish Bias with Key Resistance
Ponmudi R also commented on the Bank Nifty, highlighting, "The immediate support zone is placed at 58,000–58,250, which also coincides with the 100-day exponential moving average and acts as a crucial cushion. On the upside, 58,900–59,000 has now emerged as a major supply area and near-term resistance. Momentum has weakened, with the MACD turning negative, reinforcing the bearish bias."
He concluded, "The near-term tone remains bearish, with a sell-on-rallies approach preferred near the 58,900–59,000 resistance zone. Any meaningful recovery would require a strong close above 59,000, accompanied by healthy volumes to shift momentum. Failing that, the risk of further downside extension remains elevated."
Stocks to Buy Today: Expert Recommendations
Several stock market experts have shared their intraday stock picks for today, based on technical analysis. These recommendations come from Sumeet Bagadia, Executive Director at Choice Broking; Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi; and Shiju Koothupalakkal, Senior Manager of Technical Research at Prabhudas Lilladher.
Sumeet Bagadia's Stock Recommendations
- Medanta: Buy at ₹1120, Target ₹1200, Stop Loss ₹1080.
- Netweb Technologies: Buy at ₹3305, Target ₹3535, Stop Loss ₹3190.
Ganesh Dongre's Buy or Sell Stocks
- Wipro: Buy at ₹241, Target ₹262, Stop Loss ₹230.
- TCS: Buy at ₹3180, Target ₹3400, Stop Loss ₹3100.
- Max Health: Buy at ₹974, Target ₹1010, Stop Loss ₹950.
Shiju Koothupalakkal's Intraday Stocks for Today
- Kaynes Technology: Buy at ₹3560, Target ₹3760, Stop Loss ₹3480.
- Ather Energy: Buy at ₹626, Target ₹666, Stop Loss ₹612.
- Aster DM Healthcare: Buy at ₹570, Target ₹615, Stop Loss ₹556.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
