Sensex, Nifty snap Budget-day slide with sharp rebound led by heavyweights

Benchmark indices rebounded on bargain-hunting after their worst Budget-day fall in six years, logging the strongest post-Budget performance since February 2022 despite weak global cues

Domestic equities rebounded on Monday as bargain-hunting emerged a day after benchmark indices logged their steepest Budget-day fall in six years.

 

The Sensex closed at 81,667, up 944 points or 1.2 per cent, while the Nifty ended at 25,088, gaining 263 points or 1.06 per cent. Both indices posted their best single-day gains since November 26, 2025 and the strongest post-Budget-day performance since February 2022.

 

The total market capitalisation of BSE-listed companies rose by ₹4.4 trillion to ₹455 trillion, after a ₹9.4 trillion wipeout a day earlier.

 

The latest rebound in domestic equities comes even as global markets witnessed a selloff, triggered by concerns around artificial intelligence (AI)-led valuations and heightened volatility in precious metals. Market experts said India, having underperformed the recent AI- and commodities-driven global rally, could emerge as a contrarian bet if the global riskoff sentiment deepens.

 

 

Heavyweights led the recovery, with gains in Reliance Industries, Larsen & Toubro, and ICICI Bank driving the Sensex higher. Reliance Industries jumped 3.3 per cent, emerging as the biggest contributor to index gains after sliding 3.6 per cent on Budget day. ICICI Bank rose 1.4 per cent, making it the second-largest contributor, even though the stock had declined 2.3 per cent over the previous two sessions. Shares of Larsen & Toubro advanced on optimism around the government’s capital expenditure push outlined in the Budget.

 

“We see the Budget as incrementally positive for the Indian economy-oriented stocks, which is our preferred theme for 2026. While we already like consumption (autos, staples, consumer internet), the Budget is also supportive of capex,” said Kunal Vora, director – head of India equity research analyst, BNP Paribas.

 

Analysts said key positives from the Budget were prioritising infrastructure and manufacturing while maintaining fiscal discipline.

 

“The Union Budget for 2026-27 (FY27) stuck to its fiscal deficit consolidation path with FY27BE (BE stands for budget estimates) fiscal deficit pegged at 4.3 per cent and debt-to-GDP (gross domestic product) at 55.6 per cent. This is 10 basis points (bps) and 50 bps lower than FY26RE (RE stands for revised estimates), respectively… the overall assumptions/targets look credible and achievable,” said Suresh Ganapathy, managing director (MD) and head of financial services research, Macquarie.

 

In a knee-jerk reaction on Sunday, markets tanked 2 per cent, rattled by a sharp hike in securities transaction tax (STT) on derivatives.

 

Indian equities have struggled so far this year amid the lack of a meaningful recovery in corporate earnings and no progress on the India-US trade deal. Elevated foreign portfolio investor (FPI) selling in January has also made Indian equities underperform global peers, with FPIs remaining net sellers to the tune of ₹34,056 crore.

 

Market breadth, however, remained negative, with 2,384 stocks declining and 1,898 advancing. Most sectoral indices ended with gains, with the exception of IT and Health-care.