KuberGrow Team The Union Budget is a major event that can cause big shifts in the stock market. It lays out the government’s economic plans, and everyone—from investors to businesses—pays close attention to see how different sectors will be affected.
When the Budget announces steps to boost the economy, like tax cuts, infrastructure spending, or business incentives, it usually creates a positive buzz in the market. Investors feel confident, and stock prices often go up.
Policies that put more money in people’s pockets—like tax breaks or inflation control—are also great for the market. They encourage spending, which benefits industries like retail, automobiles, and consumer goods, leading to higher stock prices in those sectors.
Changes in taxes can also swing the market. Lower taxes on corporate profits or individual incomes attract more investments, while higher taxes might slow things down. Adjustments to taxes on stock profits or dividends can either bring more people into the market or push them away.
The Budget also influences mutual funds and bonds. Policies that make these investments more appealing, or steps like including Indian bonds in global markets, bring in foreign money, which helps the market grow.
Finally, the fiscal deficit—the gap between what the government earns and spends—plays a key role. A small deficit is seen as good management and boosts market confidence, while a bigger deficit can raise inflation and hurt businesses.
As Nirmala Sitharaman presents her 8th Budget on February 1, all eyes are on what’s in store for the economy and the stock market.
