New Delhi: Stock market benchmarks indices Sensex and Nifty declined in early trade on Wednesday, extending their Budget day fall, after the government proposed to hike securities transaction tax on futures & options.

Foreign fund outflows and a weak trend in global markets also played spoilsport for the domestic markets.

From the Sensex pack, Hindustan Unilever dropped 3 per cent after the firm reported just a 2.2 percent rise in consolidated net profit at Rs 2,612 crore for April-June FY25 impacted by price reductions.

Bajaj Finance, Nestle, HCL Technologies, UltraTech Cement, Mahindra & Mahindra and Adani Ports were the other big laggards.

The key benchmark indices ended marginally lower in volatile trade on Tuesday as the government proposed to hike the securities transaction tax on futures & options in the Budget for 2024-25.

On Tuesday, the BSE benchmark settled lower by 73.04 points or 0.09 percent at 80,429.04. The Nifty dipped 30.20 points or 0.12 percent to 24,479.05.

"Now that the steep increase in STCGs (Short-Term Capital Gains Tax) and the marginal increase in LTCGs (Long Term Capital Gains Tax) on equity is a reality, investors should focus on investing in stocks which can deliver superior returns. In the present context FMCG stocks look attractive from the valuation perspective," said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

In Asian markets, Seoul, Tokyo, and Hong Kong were trading lower while Shanghai quoted higher.

Global oil benchmark Brent crude traded higher by 0.38 percent to USD 81.32 a barrel.

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