Equity Cash Turnover Rises 22% MoM in September; H1FY26 Shows 19% YoY Decline

Equity market activity saw a noticeable pick-up in September, as trading momentum returned despite subdued performance over the first half of FY26. The latest NSE Market Pulse report paints a clear picture of investor engagement, turnover trends, and market concentration.

Market Performance: September Gains Amid H1FY26 Weakness

September brought renewed energy to equity markets, with turnover numbers reflecting stronger investor participation:

• Equity cash turnover jumped 22% month-on-month (MoM) to Rs 21.6 lakh crore.
• Average trade size increased by 4% MoM, reaching Rs 30,927 per trade.
• The total number of trades grew 17% MoM, supported by activity from 1.18 crore investors.
• On a daily basis, turnover averaged Rs 98,312 crore, up 5% from August.

Despite the monthly rise, broader trends for the first half of FY26 remain subdued:

• Quarter-on-quarter (QoQ) turnover fell 7% for July–September.
• Year-on-year (YoY) decline stood at 19% for H1FY26.
• Investor participation averaged 1.15 crore per month, down from 1.47 crore in H1FY25.

This contrast shows that while short-term market activity surged, overall participation and turnover remain under pressure compared with last year.

Company Details: Large-Cap Stocks Still Dominate

The report highlights that trading remains heavily skewed towards the largest companies:

• The top decile of stocks accounted for nearly three-fourths of total cash turnover in September.
• The top two deciles together represented 89%, indicating some diversification beyond the largest stocks.

Investors continue to gravitate toward familiar, large-cap names, keeping market activity concentrated at the top.

Derivatives Market Trends: Mixed Signals

In the derivatives space, September saw a mix of highs and lows:

• Index futures: Average trade size declined 1% MoM to Rs 27.9 lakh per trade.
• Index options premiums: Fell 4% MoM to Rs 9,049 per trade.
• Single-stock derivatives: Showed gains, with stock futures trade size climbing to Rs 8.6 lakh, marking an 11-month high, and stock options premiums reaching Rs 12,488 per trade.

Combined equity cash and derivatives trades averaged 8.5 crore per day, up 4% MoM, indicating steady overall engagement despite selective weakness in certain segments.

Expiry Shift Impacts Trading Behaviour

The NSE’s shift of index derivatives expiry to Tuesday, effective September 1, reshaped expiry-week trading dynamics:

• Nifty50 daily premium turnover rose 2.7% MoM to Rs 37,393 crore, forming 88% of total index options daily premium.
• Turnover in BankNifty, FinNifty, and MidCapNifty contracts moderated, reflecting a redistribution of trading volumes post-expiry change.

Futures and Options: Monthly and Quarterly Patterns

A closer look at turnover trends in futures and options reveals mixed movements:

• Index futures: Fell 13% MoM to Rs 22,880 crore.
• Stock futures: Dropped 5% MoM to Rs 1.14 lakh crore, marking a 22-month low.
• Index options premiums: Increased 2% MoM to Rs 42,424 crore.
• Stock options premiums: Rose 8% MoM to Rs 6,238 crore.

On a quarterly basis:

• Equity futures turnover declined 12.1% QoQ.
• Options premiums dropped 12.2% QoQ.

For H1FY26, these declines widened further:

• Futures turnover down 24.8% YoY.
• Options premiums fell 26% YoY.

These figures underline that while some monthly gains were recorded, the broader half-year performance shows clear moderation in derivatives activity.

Summary: Market Story in Numbers

September’s spike in equity cash turnover is a bright spot in an otherwise subdued H1FY26 market landscape. Key takeaways include:

• Strong monthly gains driven by more trading days and investor engagement.
• Large-cap stocks continue to dominate, though some diversification is emerging.
• Derivatives show selective strength, particularly in single-stock contracts.
• NSE expiry shift reshaped options trading patterns.
• H1FY26 overall turnover and participation remain lower compared with the previous year.

Investors and market watchers can view September as a momentary uptick amid a softer half-year trend, highlighting the market’s cyclical nature and investor concentration in top stocks.