The individual investment cap rises from 5% to 10%, while the aggregate limit for all such investors jumps from 10% to 24%. The move aims to broaden India’s equity capital base, improve market depth, and attract stable, long-term capital. | Photo Credit:

In a bid to allow non-resident individuals (NRIs) and overseas investors to take larger direct stakes in Indian listed companies, the Union Budget has sharply increased the investment limits under the Portfolio Investment Scheme (PIS).

Under the proposed framework, the individual investment cap has been raised from 5 per cent to 10 per cent, while the aggregate limit for all such investors has been increased from 10 per cent to 24 per cent.

Previous Restrictions

Earlier, the relatively low ceilings on participation by overseas individuals restricted the scale of participation, forcing most foreign equity flows to come through the registered Foreign Portfolio Investor (FPI) route rather than through direct shareholding.

The government’s move is aimed at broadening the equity capital base, improving market depth and attracting longer-term, more stable pools of capital, particularly from the Indian diaspora.

“This represents a structural shift, not a marginal tweak. Until now, foreign capital largely flowed through institutional channels—FPIs, offshore funds, the usual suspects. By opening direct access to individuals, India is diversifying its capital base, which should, over time, reduce volatility, improve liquidity and bring longer-duration money into the market,” said Mitesh Shah, CEO at Equirus Family Office.

Overseas inflows

Enhanced flexibility in this framework is expected to also support market liquidity and more efficient price discovery, said Moin Ladha, Partner at Khaitan & Co. “It is likely to facilitate greater participation of NRI capital and improve access to stable, long-term overseas funds. Going forward, continued clarity and calibrated liberalization in this space would be welcome, as they can play a meaningful role in strengthening foreign investment inflows into India,” Ladha said.

Tanvi Kanchan, Associate Director and Head of NRI Business at Anand Rathi Share and Stock Brokers, said, “These increases enable foreign investors to build more substantial positions in Indian companies, which could enhance market efficiency, broaden the shareholder base, and foster stronger long-term investment in Indian capital markets.”

Greater participation

Analysts expect the change to encourage greater participation from NRIs in fundamentally strong companies and reduce reliance on short-term foreign flows. The actual impact, however, will depend on ease of execution, regulatory clarity and overall market sentiment. Over time, greater direct overseas ownership could improve price discovery, enhance corporate governance by broadening the investor base, and make Indian markets more resilient to volatile global capital flows.

Published on February 1, 2026

Derivatives segment accounts for a significant share of revenues for brokerage platforms.

Shares of listed broking firms such as BSE Ltd, Angel OneGroww, nuvma and IIFL Capital Services came under sharp selling pressure after the increase in Securities Transaction Tax (STT) on futures and options, sparking concerns over trading volumes and near-term profitability for capital market intermediaries.

BSE shares closed 8 per cent lower at ₹2,578.10, after plunging 15 per cent to ₹2,377.40 against the previous close of ₹2,797. CDSL traded 7 per cent lower at ₹1,229.30.

Angel One shares tanked 9 per cent to end at ₹2,313. The stock dragged over 13 per cent to ₹2,199.50 during the session from the previous close of ₹2,540.90.

Billionbrains Garage Ventures (Groww) shares fell 14 per cent to ₹152.52 before settling with 5 per cent loss at ₹168.10.

IIFL Capital Services stock plunged over 17 per cent to ₹272.60 in early trade.

In addition, Nuvama Wealth Management and 360 ONE WAM also witnessed significant sell-off.

The increased STT on futures contracts and on options premium could cool participation in the derivatives segment, which accounts for a significant share of revenues for brokerage platforms, according to analysts.

Jateen Trivedi, VP – Research Analyst (Commodity and Currency) at LKP Securities, said markets were already uneasy about the fiscal deficit target of 4.3 per cent for FY27, but the sharper reaction stemmed from the higher transaction levies. He noted that the STT hike is likely to dent participation in futures and options and could also reduce speculative volumes in commodities.

Dhiraj Relli, Managing Director and CEO of HDFC Securities, described the market’s initial reaction as largely knee-jerk, driven by the revised tax framework for derivatives. While acknowledging that the enhanced STT regime may create near-term headwinds for capital market participants, Relli said the Budget reflects a pragmatic and calibrated policy approach. He added that investors should remain focused on sectors with strong earnings visibility rather than capital-intensive plays, and argued that the government’s long-term vision for market stability and maturity could ultimately benefit the broader financial ecosystem through FY27.

Echoing concerns around trading activity, Shripal Shah, Managing Director and CEO of Kotak Securities, said the steep increase in STT on futures and options, coming on top of last year’s hike, is likely to raise impact costs for traders, hedgers and arbitrageurs. According to him, this could cool derivative activity and lead to lower volumes, with the intent appearing to be moderation rather than revenue maximization, as any tax gains may be offset by reduced turnover.

Aakash Shah, Technical Research Analyst at Choice Equity Broking, warned that the STT increase could act as a marginal negative for foreign portfolio investor flows in the near term, particularly for high-frequency and derivative-focused global funds. He pointed out that higher transaction costs meaningfully reduce post-tax returns for active strategies at a time when overseas investors have already been cautious due to global risk-off sentiment, elevated US bond yields and currency pressures.

Shah added that while long-only, fundamentally driven FPIs are unlikely to be deterred solely by the STT hike, the higher costs could marginally shift tactical allocations toward other Asian markets. Overall, he said the move risks dampening trading volumes and slowing short-term foreign participation, even as broader inflows will continue to hinge on macro stability, rupee movement and consistency in tax policy.

Amit Majumdar, Group Chief Strategy Officer, Angel One Ltd, has said that F&O brokerage contributed about 44 per cent of gross revenue, while interest income from client funding and our broader platform accounted for around 33 per cent in Q3FY26, with the rest coming from cash and commodity broking, depository, distribution, and other income streams. “This diversified mix reinforces the resilience of our model and gives us confidence that the broader trajectory of our business remains firmly intact.”

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Published on February 1, 2026

Experts called it a continuation budget, balancing near-term market concerns with structural positives. | Photo Credit: PTI

The Union Budget 2026-27 has drawn mixed reactions from market participants, with experts highlighting the government’s focus on fiscal discipline and infrastructure spending while expressing disappointment over the increased securities transaction tax and the lack of capital gains tax relief.

STT Hike

The budget increased STT on futures from 0.02 per cent to 0.05 per cent and raised STT on options premiums to 0.15 per cent from 0.1 per cent, a move that dominated immediate market sentiment. “The only real negative in the Budget is the increase in STT on derivatives, and that’s what the market is reacting to in the short term,” said Amisha Vora, Chairperson and Managing Director of PL Capital – Prabhudas Lilladher.

Tushar Badjate, Director of Badjate Stock & Shares, said the STT increase “came as an unwelcome move for market participants at a time when equity markets have been under pressure and foreign institutional flows have remained volatile.” He noted that expectations were high for rationalization of capital gains taxation, but “the Budget largely maintained the status quo on taxation.”

Structural Positives

Several experts emphasized the budget’s structural positives despite the near-term negatives. The government maintained capital expenditure at ₹12.2 lakh crore for FY27, representing a 9 per cent increase. “Capital markets play a crucial role in economic growth, currency stability, and capital formation,” Badjate added, calling the absence of targeted incentives for foreign institutional participation “a missed opportunity.”

On fiscal discipline, Anirudh Garg, Partner and Fund Manager at INVasset PMS, said the government’s adherence to “a fiscal deficit path of 4.4 per cent in FY26 and 4.3 per cent in FY27, alongside a gradual reduction in the debt-to-GDP ratio toward the mid-50 per cent range, signals continuity and discipline.”

Foreign Investment

The budget proposed measures to attract foreign investment, including allowing non-resident individuals wider access to invest in listed equities and raising PMS investment limits for NRIs to 24 per cent from 5-10 per cent. “This is a strong positive for capital flows,” Vora said. Manoj Purohit, Partner at BDO India, described the amendment as “much-awaited” and said it would “not only increase inflows but also help stabilize the currency and capital markets.”

Financial Reforms

Financial sector reforms featured prominently. Gayathri Parthasarathy, Partner and Leader – Financial Services at PwC India, highlighted “the strong emphasis on financial sector reforms”, including a proposed high-level committee on banking to “align the sector with India’s next growth phase and help in achieving Viksit Bharat goals.”

Market Innovations

The budget introduced market-making framework and total return swaps on corporate bonds. Mahavir Lunawat, Chairman and Managing Director of Pantomath Capital, called this “a game-changer” that “ensures that investors can buy and sell with much greater ease and lower costs.”

Strategic Investments

Infrastructure and manufacturing received significant attention. Darshan Rathod, COO of MULTYFI, said the rare earth corridors across four states represent “India’s calculated move to capture supply chain fragmentation away from China.” The Bio Pharma Shakti allocation of ₹10,000 crore and Semiconductor Mission 2.0 were described as “strategic investments in sectors where India possesses latent comparative advantages.”

Data Center Boost

N. ArunaGiri, CEO of TrustLine Holdings, said “the tax exemption for foreign investments in data centers is a welcome step and reinforces India’s positioning as a global investment destination.” He added that “safe harbor clarifications and related provisions introduced in the Budget are likely to meaningfully boost investments by Global Capability Centres.”

Stable Outlook

Sonam Srivastava, Founder and Fund Manager at Wright Research PMS, described the budget as “a continuation budget rather than a disruptive one, which in itself is a positive at this stage of the cycle.” She noted that “stable tax policy, predictable capex, and bond market deepening together improve India’s relative attractiveness versus other EMs.”

Published on February 1, 2026

Silver Prices in India dipped sharply as reported on February 1 across all major cities. The price of one gram silver and one kg silver dipped ₹30 and ₹30,000, respectively compared with the previous session’s closing price. This report provides a detailed, city-by-city breakdown of the latest silver prices.

Market experts remain constructive on silver but urge investors to balance optimism with caution.

Silver Rate in India

Silver prices declined with the average rate settling at ₹320 per gram, down ₹30, while one kilogramme now costs about ₹3,20,000, cheaper by ₹30,000.

Silver Rate in Mumbai

Silver prices in mumbai declined to ₹320 per gram, down ₹30, while one kilogram now costs about ₹3,20,000, cheaper by ₹30,000.

Silver Rate in Chennai

Chennai’s silver rates have also seen a decrease to ₹3,20,000 per kg, while 1 gm of silver is available at ₹320, or ₹30 cheaper.

Silver Rate in Delhi

In Delhi, the prices moved similarly lower, tracking losses seen across major cities. The price of one kilogram of silver dipped to ₹3,20,000 compared with ₹3,50,000 in the previous session, marking a steep ₹30,000 slide in a single day.

Silver Rate in Ahmedabad

Silver prices in Ahmedabad decreased, mirroring the downtrend seen across other parts of the country. The cost of one kilogram fell sharply by ₹30,000 to ₹3,20,000, down from ₹3,50,000 in the previous session. In turn, 1 gm of silver was available for ₹320, cheaper by ₹30 compared with the previous session’s price of ₹350.

Silver Rate in Kolkata

In Kolkata, the white metal saw an equally strong dip, as a kilogramme became cheaper by ₹30,000 at ₹3,20,000 compared with ₹3,50,000 for which it was available yesterday.

Silver Rate in Bengaluru

In Bengaluru too, silver prices declined by ₹30 and by ₹30,000 to ₹320 per gram and to ₹3,20,000 per kg, respectively.

Silver Rates Courtesy: bankbazaar.com

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Published on February 1, 2026

gold and silver prices remained under pressure on Sunday afternoon following the Union Budget presentation, with traders attributing the decline primarily to global macro factors rather than Budget announcements, as both metals recovered partially from morning lows after hitting lower circuits.

mcx gold Futures traded 5 per cent lower after a modest intraday recovery, having slid 9 per cent earlier in the session. MCX silver held declines as traders approached the budget cautiously, wary of potential changes to import duties on precious metals, according to market observers.

“Selling pressure intensified on the MCX today, with both metals hitting lower circuits, sliding 9 per cent earlier amid a brutal session, compounding Friday’s steep losses of 17 per cent in gold and 27 per cent in silver. Currently, gold trades 5 per cent lower after a modest intraday recovery, while silver holds declines as traders now approach the Union Budget cautiously, wary of potential changes to import duties on precious metals,” said Kaynat. Chainwala, AVP – Commodity Research, Kotak Securities.

The selloff followed Friday’s crash when gold and silver suffered their steepest single-day fall since 1980, settling at $4,864 per ounce and $84.66 per ounce respectively. “The sell-off was triggered by a sharp rebound in the US dollar, broad-based global market weakness, and the Trump administration’s nomination of Kevin Warsh, widely regarded as an inflation hawk, as the next Federal Reserve chair,” Chainwala added.

Market participants noted the correction came after an unprecedented rally. “Data shows that until 29th January, silver had surged 319 per cent year-on-year in rupee terms, while gold had risen 118 per cent. Even after a correction of around 11 per cent in silver and 4.3 per cent in gold on 30th January, silver remains up 268 per cent YoY and gold 108 per cent YoY,” said Sriram BKR, Senior Investment Strategist, Geojit Financial Services.

Domestic gold had retreated from highs near ₹1,80,000 per 10 grams to stabilize around ₹1,49,500-₹1,49,653, while silver corrected from peaks near ₹4,20,048 per kg to around ₹2,91,925-₹2,91,000.

“The ETF prices have turned volatile on the downside, also on the back of expectation around changes in customs duty on Gold & Silver, in the Union Budget,” Sriram added.

Analysts maintained that the decline was driven by global factors rather than Budget-related concerns. “Today’s sharp fall in gold and silver ETFs looks scary on the screen, but it’s more of a sentiment shock than a story-breaker. Precious metals had run up sharply over the last year, and what we’re seeing now is a mix of profit-booking, global volatility and reaction to macro cues,” said Akshat Garg, Head Research & Product, Choice Wealth.

Further pressure may emerge as higher CME margins take effect on Monday, February 2. “Gold margins will rise to 8 per cent from 6 per cent for non-heightened risk profiles, and to 8.8 per cent from 6.6 per cent for heightened risk profiles. Silver margins will increase to 15 per cent from 11 per cent for non-heightened risk profiles, and to 16.5 per cent from 12.1 per cent for heightened risk. profiles,” according to a CME exchange statement released Friday.

“Given elevated prices, a buy-on-dips strategy is preferable. Gold is expected to find support in the 5,000-5,100 zone, while silver has strong support in the 95-102 range. The medium-term outlook for both metals remains constructive amid persistent geopolitical and policy uncertainty,” Chainwala said.

“For investors, this isn’t a moment for panic. Gold and silver are portfolio hedges, not trading bets. If your allocation is sensible, staying put makes sense,” Garg advised.

Published on February 1, 2026

Finance Minister Nirmala Sitharaman presented her ninth Union Budget in Parliament on February 1, 2026. In the immediate aftermath, the Nifty 500 slipped about 1 per cent from the previous close to around 22,819. By 1:20 PM, market Breadth was weak, with 354 stocks declining, against 146 advancing.

The sharpest early losses were concentrated in a handful of pockets. Metals and mining names such as Hindustan Copper Ltd, Hindustan Zinc, National Aluminum Co Came under pressure. Capital market and broking counters, including Multi Commodity Exchange of India, BSE, Angel OneNuvama Wealth Management, also corrected sharply. Financials — Bank of India, Bank of Baroda, Union Bank of India, Karur Vysya Bank, Muthoot Finance, IIFL Finance — featured prominently among the losers. Overall, cyclicals and market-linked plays bore the brunt of the sell-off.

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Published on February 1, 2026

The Bombay Stock Exchange has modified the reference price calculation for gold and silver exchange-traded funds effective only February 1, 2026, shifting to T-1 net asset value as the basis for daily price bands instead of previous day’s closing prices.

The change, announced through Notice, comes as precious metals witnessed extreme volatility with gold futures plunging approximately 16 per cent from recent peaks above ₹1,80,000 to around ₹1,49,500, while silver experienced a sharper correction of nearly 40 per cent from highs near ₹4,20,000 to ₹2,91,000 levels in late January.

Under the revised framework, the prescribed price band of plus or minus 20 per cent will now be applied to the previous day’s NAV published by respective mutual funds and asset management companies, rather than market closing prices.

BSE’s Head of Trading Operations Ketan Jantre issued the directive to trading members, citing volatility in underlying gold and silver prices as the primary reason for the adjustment.

The violent correction followed President Trump’s nomination of Kevin Warsh as the next US Federal Reserve Chair on January 30. Warsh, known for his hawkish stance on inflation, triggered a rapid repricing across markets as the dollar strengthened and real yields rose, leading to aggressive unwinding of leveraged positions in precious metals.

Despite the sharp selloff, market analysts maintain that the secular bullish structure remains intact, supported by central bank gold accumulation and silver’s structural supply deficits driven by industrial demand from green energy, electric vehicles, and electronics sectors. The correction is being characterized as a leverage flush rather than a fundamental trend reversal.

The BSE’s technical adjustment aims to provide more accurate price discovery for ETF trading by aligning daily bands with fund valuations rather than potentially distorted market prices during periods of extreme volatility.

Published on February 1, 2026

Indian equities slumped sharply in mid trading session on Sunday as investors reacted nervously to the Union Budget, with broad-based selling dragging benchmark indices deep into the red. The sell-off was steeper in the broader market, where midcap and smallcap stocks slid 2–3 per cent, while all sectoral indices traded lower—led by PSU banks, financials, metals, chemicals and FMCG shares, which declined 2–4 per cent.

BSE Sensex was down 1,043.91 points, or 1.27 per cent, at 81,225.87 around 12.42 pm, after hitting an intraday low of nearly 2,400 points, while the Nifty 50 slipped 360 points, or 1.42 per cent, to 24,960.65, having fallen as much as 869 points earlier in the session.

Top movers

Max Health, Wipro, Sun Pharma, TCS and Dr Reddy’s Lab traded as major gainers, while Hindalco, Bharat Electronics, Shriram Finance, Coal India and SBI depreciated the most among Nifty 50 pack.

Market breadth remained weak, with declines far outnumbering advances in the session. Out of 3,113 stocks traded on the National Stock Exchange, as many as 1,938 traded lower, while only 1,083 advanced and 92 remained unchanged.

The number of stocks hitting 52-week lows at 160 sharply exceeded the 22 touching fresh highs, underscoring the risk-off mood. Meanwhile, 89 stocks were locked in the upper circuit, but a higher 99 hit the lower circuit, reflecting intense selling pressure across counters.

Sectoral impact following Budget

Defense stocks (BEL, GRSE and HAL), railway stocks such as BHEL, IRFC, IRCTC dragged following the budget presentation. Meanwhile, aqua and seafood stocks soared. Broking stocks witnessed pressure due to an increase in securities transaction tax (STT) on futures.

Shripal Shah, MD & CEO Kotak Securities, emphasized the steep increase in STT on futures and options will likely impact costs for traders, hedgers, and arbitrageurs. “This could cool derivative activity and lead to a reduction in volumes. The intent appears to be volume moderation rather than revenue maximization, as any potential revenue gain could be offset by lower derivative volumes.”

Under the midcap index, NTPC Green, Tata Communications, Swiggy, Motilal OFS and HUDCO rose 1-3 per cent, while National Aluminium, BSE, Muthoot Finance, BDL and Bank of India plunged 6-9 per cent.

Among smallcap, Anant Raj, Neuland Lab, IFCI, Zensar Tech and Trident soared 3-9 per cent, MCX, Hindustan Copper, Angel One, Nuvama, IIFL and Karur Vysya Bank shares dragged 6-13 per cent.

Despite the market trading in the red post-Budget, analysts remain constructive on several sectors. Abhinav Tiwari, Research Analyst at Bonanza, said infrastructure and capital goods are likely to emerge as key beneficiaries, citing the government’s decision to raise capital expenditure to ₹12.2 lakh crore.

Companies involved in construction, EPC, cement and industrial equipment are expected to see improved sentiment and earnings outlook.

“Higher allocations and policy support for electronics, semiconductors, chemicals, textiles, capital goods and container manufacturing strengthen India’s role as a global manufacturing hub. This is positive for electronics manufacturing services, specialty chemical companies and textile exporters, as it supports capacity expansion and long-term growth.

For banking and financials, the impact is largely neutral,” Tiwari said. He also highlighted that the budget is clearly supportive for IT services and data centres, pointing to tax certainty, higher safe-harbour limits and long-term tax incentives for global data-centre operations in India.

Published on February 1, 2026