Indices seen opening mildly higher

GIFT Nifty:

GIFT Nifty February 2026 futures were up 10 points, suggesting a mildly positive start for the Nifty 50 today.

Brent crude prices slid more than 3% on Monday after US President Donald Trump said over the weekend that Iran was seriously talking with Washington, a signal of easing tensions with the OPEC member. The comments tempered fears of a potential military strike that had earlier pushed oil prices to multi-month highs.

Institutional Flows:

Foreign portfolio investors (FPIs) sold shares worth Rs 588.34 crore, while domestic institutional investors (DIIs) were net sellers to the tune of Rs 682.73 crore in the Indian equity market on 1 February 2026, provisional data showed.

The FIIs sold shares worth Rs 38740.12 in January. This follows their cash sales of Rs 34,349.62 crore in December and Rs 17,500.31 crore in November.

Global Markets:

The US Dow Jones index futures is currently down by 190 points, signaling a weak opening for US stocks today.

Asian equities slipped on Monday as investors digested fresh private data on Chinas factory activity for January, while gold continued to slide after last weeks drop.

Chinas manufacturing momentum picked up pace in January, a private survey released on Monday showed, with producers ramping up output and shipping goods ahead of the long Lunar New Year break.

The RatingDog China General Manufacturing PMI, compiled by S&P Global, edged up to 50.3 in January from 50.1 in December. Since readings above 50 signal expansion and those below indicate contraction, the latest print points to a modest improvement. It was also the strongest showing since October, when the index stood at 50.6.

Over in the US, stocks ended lower on Friday as technology shares stayed under pressure, even as markets broadly welcomed President Donald Trumps choice of Kevin Warsh as the next Federal Reserve chair. Despite the late-month wobble and choppy trading through January, the S&P 500 still managed to close the month in positive territory. On Friday, the index slipped 0.43% for its third straight decline, the Dow Jones Industrial Average fell 0.36%, and the Nasdaq Composite lagged with a sharper 0.94% drop.

Warshs nomination helped calm nerves around the Feds independence, given his past experience as a central bank governor and his firm views on inflation. While he is expected to favour lower interest rates in the near term, in line with Trumps preferences, markets see him as someone likely to retain policy credibility rather than simply take cues from the White House.

Domestic Market:

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 levelmaintaining 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 trajectorythe 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 sparked aggressive unwinding in stocks linked to capital market sector, with brokerages, exchanges and other high-beta F&O counters bearing the brunt of the selling during the single special session.

The S&P BSE Sensex tumbled 1,546 points or 1.88% to 80,722.94. The Nifty 50 index dropped 495.20 points or 1.96% to 24,825.45.

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