Brokerage Stocks Slide as SEBI Mulls Linking Options Leverage to Cash Balances

India’s capital market intermediaries came under pressure on July 4, 2025, following reports that SEBI may soon require brokers to link options leverage strictly to clients’ available cash balances. The proposed move, aimed at curbing speculative excesses in the derivatives market, triggered a sharp selloff in stocks like Angel One, BSE, and CDSL amid fears of reduced trading volumes and tighter compliance norms.

 

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Sectoral Impact:

Outlook: Though the proposal is still under review, the market’s reaction underscores investor sensitivity to regulatory shifts. Analysts expect shortterm volatility in capital market stocks, but firms with diversified business models and strong compliance frameworks may remain resilient.

 

Sources: Business Standard, Goodreturns, Upstox, Business Upturn