Budget 2024: Performance of the Indian Stock Market on Budget Day Over the Last 10 Years

Indian Stock Market on Budget Day : Data from the past ten years shows that the Indian market closed on a negative note in eight out of ten sessions on budget announcement day (February 1).

Finance Minister Nirmala Sitharaman is set to present the Union Budget for 2024-25 on Tuesday, July 23. The Union Budget has historically been a key trendsetter for the Indian stock market, often associated with market volatility.

Data from the past ten years reveals that the Indian market closed on a negative note in eight out of ten sessions on budget announcement day (February 1).

On February 1, 2024, the Indian stock market experienced increased volatility. The BSE Sensex fell by 106.81 points, or 0.15%, ending the day at 71,645.30, while the NSE Nifty dropped by 28.25 points, or 0.13%, closing at 21,697.45.

In contrast, on the same day last year, Indian indices showed mixed results. The Sensex rose by 158 points, or 0.27%, to finish at 59,708.08, while the Nifty fell by 46 points, or 0.26%, closing at 17,616.30. This was the first time since 2018 that the Indian indices moved less than one percent on budget day; in 2018, the market ended almost unchanged with a slight decline of just 0.1%.

Year	Nifty Performance on Budget Day (%)
2024	-0.13
2023	-0.20
2022	1.40
2021	4.70
2020	-2.50
2019	-1.10
2018	-0.10
2017	1.80
2016	-0.60
2015	0.60
2014	-0.20

On budget day, the market saw an increase of over 4 percent in 2 out of 9 sessions. Specifically, it rose by 4.7 percent in 2021 and by more than 4 percent in 2001.

In 2023, both the pre-budget and post-budget months saw declines, with each falling by more than 2 percent. Similarly, in 2022, the Nifty dropped by 3 percent in February (post-budget) and decreased by 0.1 percent in January (pre-budget).

In 2021, the market fell by 3.5 percent in the month before the budget but rose by approximately 2 percent in the month after the budget.

In 2020, amid the pandemic, the market declined in both the pre-budget and post-budget months, with drops of 1.8 percent and 3 percent, respectively.

The market last saw a gain in the pre-budget month in 2018, with a 5.6 percent increase. Before 2018, the biggest pre-budget gains were 11 percent in both 2002 and 2000. On the other hand, the most notable post-budget increase occurred in 2016, with a 10.75 percent rise.

Market Outlook Ahead of the Union Budget 2024-25

On Monday, July 22, Indian stock market benchmarks Nifty 50 and Sensex ended in the red ahead of the Union Budget 2024. The Nifty 50 fell by 22 points, or 0.09 percent, closing at 24,509.25, while the Sensex decreased by 103 points, or 0.13 percent, settling at 80,502.08. Despite the cautious sentiment surrounding the upcoming Budget, mid and small-cap segments showed strong gains.

Nifty experienced a volatile session ahead of the highly anticipated budget announcement, which will be crucial in determining the future direction of the indices. The Nifty index has key support around the 24,150 level, while a decisive breakout above 24,800 could signal a new upward trend in the coming days,” said Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher Pvt. Ltd.