The Securities and Exchange Board of India (Sebi) is likely to impose stricter margin trading rules on budget day to combat potential volatility, said two people aware of the matter, including an official with the regulator. The Union budget is scheduled to be presented on 1 February.
Stock markets can become volatile on budget day. While the past seven years saw the Sensex’s budget day close change less than 2% of the previous day’s, there have been instances when the markets have seen wild moves—for instance, Pranab Mukherjee’s 2009-10 budget when the Sensex closed 5.83% lower or Yashwant Sinha’s 2000-01 budget when it fell 5.12%.
