Markets to Hit New Highs by 2026 Despite Budget's Initial Jolt

• Indian equity markets saw a 2% decline after the Union Budget 2027 announcement, primarily due to increased Security Transaction Taxes (STT) on futures and options.
• The budget, while predictable and lacking immediate growth-stimulating announcements, is considered well-balanced with a focus on capex and sustaining GDP growth.
• Experts believe the market correction is sentiment-driven and short-lived, as STT changes do not impact the fundamental value of underlying securities.
• Strong corporate earnings, a healthy banking sector, and a consistent government capex push provide a solid fundamental groundwork for future growth.
• Fiscal deficit targets and conservative government assumptions suggest resilient core economic fundamentals, paving the way for new market highs by 2026.