The Indian equity markets experienced fluctuations on Budget day because investors sold their shares after they had made early profits, which caused the Sensex to drop 500 points from its daily peak and the Nifty to decline under 25,300.

The benchmark indices raised their values before Finance Minister Nirmala Sitharaman started her ninth Union Budget presentation at 11 am. The Sensex reached an intra-day high of 82,726.65 which represented a 457-point increase that amounted to 0.55% whereas the Nifty advanced to 25,440.90 after gaining 120 points which equaled 0.47%.

However, profit booking set in soon after the Budget speech began. The Sensex index fell to 82,230.75 at 11:45 am after the market decreased by 39 points which equals 0.05 percent. The Nifty index reached 25,291.60 at 11:45 am after it declined by 29 points which represents a 0.11 percent drop.

Market Movers

The Nifty50 stocks showed their strongest declines through Hindalco Industries and Coal India and State Bank of India, which experienced losses of up to 5%. Max Healthcare Institute and Mahindra & Mahindra both achieved gains that reached 3%. The market showed positive movement because 2,041 shares advanced while 1,566 shares declined and 150 shares remained unchanged.

3 Key Reasons Behind the Decline

1. Profit Booking: After recording a peak as high as 0.5%, investors had been able to lock in gains during the day.
2. Budget Day Volatility: Historically, markets witness sharp swings during Budget announcements. In 14 of the last 15 Budgets, the Nifty 50 recorded intra-day fluctuations of 2–3%.The markets will continue to show high volatility which will depend on fiscal policy and capital expenditure allocation and specific sector incentives and the government fiscal deficit target. Ponmudi R the CEO of Enrich Money made this statement.
3. India VIX Rises: The India VIX , which measures market volatility , increased more than 4 percent to reach 13.96 which indicates that investors face heightened uncertainty while traders maintain their cautious approach.

Technical Outlook

According to Anand James, Chief Market Strategist at Geojit Investments, the Nifty has held above critical support at 25,180, preventing a deeper fall toward 24,715–24,580. “Expect swings within the 25,180–25,400 range. Oscillators suggest potential upside toward 25,580–25,800, though momentum is weak, raising sustainability concerns,” he added.

Investors are advised to monitor Budget announcements closely, as the markets may continue to experience short-term volatility in the coming sessions.