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Union Budget 2025: Should you invest in shares before Union Budget? – Union Budget 2025 Should You Invest in Stocks Before Presentation of Union Budget

Budget 2025: The government is going to present the union budget to the government when GDP growth has become sluggish and global conditions are uncertain. Even more important is that the stock market has continued to decline for the last four months. This has caused great damage to investors. In such a situation, Stock Market Investors are eyeing Finance Minister Nirmala Sitharaman. He hopes that the Finance Minister will make an announcement, which can change the mood of the stock market. The question is whether investors should invest in shares before the union budget arrives?

More declines in midcap-jokes in the last one month

The market’s major index has fallen significantly from its all-time high of September 2024. The decline has increased in the last few weeks. Sensex And Nifty Midcap and smallcap stocks have declined more than against. It includes foreign institutional investors (Fii) It is a big hand to sell. The growth in India seems to be dull. On the other hand, America is a strong trend in dollars. American bond yield has also increased. There is uncertainty about the policy of the new US President Donald Trump. This has affected FIIS.

Government’s focus will remain on fiscal consolidation

It is expected that there will be no basic change in the government’s policy in the budget. There will not be much response in the market regarding the budget. If the government’s focus declines on fiscal consolidation, the market may see a decline. However, it is expected. It is more expected that the government will keep the target of fiscal deficit 4.5 per cent for the next financial year. However, there is pressure on the government to increase consumption. For this, big steps can be seen in the budget.

The target of capital expenditure may increase by 10 percent

The government may get some relief due to low capital expenditure in this financial year. For FY25, the government had set a target of Rs 11.11 lakh crore for capital expenditure. Between April and November, the government’s capital expenditure has been only Rs 5.1 lakh crore. This is 46 percent of the fixed target. Therefore, the government’s capital expenditure in FY25 is expected to be around Rs 10 lakh crore. In such a situation, on February 1, the government is expected more expected to increase the capital expenditure of FY26 by 10 percent.

Also read: Budget 2025: Will the stock market climb or fall on the budget day? Know what is the record of previous years

Opportunity to invest in stocks in strong fundamentals

The stock market is expected to have no changes in the capital gains tax. The banking sector is demanding tax relief on the interest of fixed deposits. On the other hand, the mutual fund industry hopes that the government will start indexation benefits again on date mutual funds. Overall, it seems that if the announcement in the budget does not have a positive effect on the market, then there will be no negative effect. When the valuation of the market is coming to the right level, investors should invest in stocks of strong companies with good research.

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