STT Hike Rattles Markets: Sensex, Nifty Plunge Over 2% in Worst Fall in 7 Years
Business
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Moneycontrol•01-02-2026, 16:08
STT Hike Rattles Markets: Sensex, Nifty Plunge Over 2% in Worst Fall in 7 Years
- •Equity markets experienced a sharp correction, with Sensex plummeting 1,547 points and Nifty falling below 24,850.
- •The India VIX surged 14%, indicating heightened market volatility following the Union Budget 2026.
- •Brokerages attributed the market decline primarily to the proposed increase in Securities Transaction Tax (STT) on futures and options (F&O).
- •The STT hike aims to curb excessive trading in the derivatives segment, where over 90% of retail investors incur losses.
- •New STT rates: futures to 0.05% (from 0.02%), options premium to 0.15% (from 0.1%), and options exercise to 0.15% (from 0.125%).
Why It Matters: Union Budget's STT hike on F&O caused a significant market downturn, impacting traders and brokerages.
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