No-transaction day likely for mutual funds as stock markets open on Budget Sunday: Deepak Shenoy

Indian stock markets will be open on Sunday, February 1, 2026, for the Union Budget, but most mutual fund investors may not be able to buy or sell units that day, Capitalmind AMC CEO Deepak Shenoy explained in a post on X.

Shenoy explained in a post on microblogging platform X, formerly twitter, that while markets will function on a Sunday, mutual funds are likely to observe a no-transaction day because banking channels will not be operational. As a result, investors may still receive a net asset value (NAV) for that day, but they may not be able to buy or sell mutual fund units at that NAV.

He flagged liquid and overnight funds as a notable exception. These categories already have a Sunday NAV under normal circumstances, with any transactions placed over the weekend or early on Monday typically mapped to that NAV. As a result, liquid and overnight funds are structurally better suited to handle a Budget-on-Sunday scenario than other mutual fund categories.


Exchange-traded funds, or ETFs, will remain available for trading as markets will be open. However, Shenoy cautioned that ETF pricing may not function normally. Market makers may be unable to participate fully because they cannot access funding or create new ETF units, potentially leading to prices deviating from intraday NAVs published on fund websites.

Such deviations could become more pronounced if markets turn volatile on Budget Day, raising risks for investors trading ETFs on that Sunday. Shenoy advised investors to remain cautious and aware of these distortions.

Reflecting on the broader issue, he suggested that holding the Budget on a Monday when February 1 falls on a weekend could help avoid such operational complications.

As for expectations from the Budget, the market veteran added that he doesn't have any expectations from a capital markets standpoint as key tax decisions like GST are handled independently by the GST council. “On personal taxation, I think we've reached a certain layer of stability, and the government is gradually incentivizing the new, cleaner tax regime over the old regime with its many exemptions,” he told ET Now.

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