Angel One, CDSL, BSE, other capital market stocks jump up to 8%. 3 reasons behind the rally

Capital market stocks jumped up to 8% on Tuesday, extending sharp gains as an overall market rally, along with rising hopes for a relief on long-term capital gains tax as well as FII buying boosted investor sentiment.

The sharp surge in stocks pushed the Nifty Capital Markets index more than 3% higher, hitting a seven-week high of 5,380 on Tuesday. Angel One shares were the top gainer, with the shares of the company rallying nearly 8%, extending gains to 32% in 2026 so far.

Motilal Oswal Financial Services jumped nearly 6%, while CDSL, CAMS and 360 One WAM shares gained around 5% each. NAM India, Groww, KFinTech, MCX, BSE, HDFC AMC and IEX shares gained 2-3%.


Also read | Why is the market rallying today?

Here are 3 reasons why capital market stocks may be rallying today.

1. LTCG tax relief on the cards

The buzz around potential relief on the LTCG tax front continues to grow louder. The central government would "consider" the request from foreign investors to review the structure of taxes levied on equity capital gains, Finance Minister Nirmala Sitharaman said on Monday. The circumstances have changed and, therefore, the voices of concern are louder,'' she said at a media event, in reference to reports that her administration has received suggestions to review levies on long-term capital gains (LTCG) for overseas investors. "I quite appreciate that. So, I'll consider all this... Our growth is very important; where people are putting their very best, we can see sustained 7(%)-plus growth.''

This comes after she said in October that discussions around long-term capital gains tax (LTCG) and securities transaction tax (STT) were ongoing, giving investors a fresh talking point at a time when markets are looking for relief after weeks of pressure.

2. FIIs buying

Jefferies in a recent report said that a potential cut to LTCG tax could offer foreign investors a reason to return to a market they have steadily abandoned, with banks, energy companies and other largecaps positioned to benefit the most.

After a sharp selloff that rattled Dalal Street, foreign investors have begun buying Indian equities again, boosting investor sentiment. FIIs were net buyers of Indian equities on Monday, purchasing shares worth nearly Rs 3,115 crore, according to provisional data on NSE. FIIs have remained net buyers of Indian equities in six out of 11 sessions in the second half of October, after remaining net sellers in nine out of 10 sessions in the first half.

Also read | $64 billion out, $5 billion in? Why LTCG tax cut may not be enough to bring FIIs back

3. Indian stock market rallies

In this context, Indian stock markets are rallying this week. After jumping nearly 2% each on Monday, Sensex and Nifty extended gains on Tuesday. Sensex gained nearly 730 points to cross 76,420 while Nifty 50 jumped more than 190 points to rise above 23,630. The sharp gains added nearly Rs 4 lakh crore to the total market capitalisation of all companies listed on BSE, pulling it up to Rs 486 lakh crore.

The rally in the market following a sharp selloff may have boosted sentiment for the capital market stocks as well as sentiment on Dalal Street.

Disclaimer: This article has been written by Debaroti Adhikary, who is not a SEBI-registered Research Analyst or an Investment Adviser. Debaroti Adhikary and his/her ‘relative(s)’ (as defined under Section 2(77) of the Companies Act, 2013) do not hold any financial interest in the companies mentioned in this article as of the date of publication. The views/recommendations mentioned in this article, wherever applicable, are those of the respective SEBI-registered Research Analyst/brokerage and have been reproduced/reported with due attribution. They should not be construed as the views or recommendations of The Economic Times Digital or the journalist. Readers are advised to consider the original research report and make their investment decisions based on their own assessment. Brokerage disclaimers here.