The day of the country’s general budget is always special for the stock market. Investors’ eyes remain fixed on the TV screen, fingers on the mobile app and heart beats every budget announcement with increasing speed. Sometimes a decision makes the market swing and sometimes a change in tax or policy dashes the expectations of investors.
If we look at the data from 2021 to 2025, it is clear that the market sentiment is mixed on the budget day. At some places there was a record rise and at other places there was a slight decline. Overall, an average fluctuation of 0.2 to 0.5 percent was seen in Sensex and Nifty. Although the indices may have remained range-bound, the sector-wise move gave huge profits to many investors. Before the presentation of Union Budget 2026, it is interesting to know what was the mood of the stock market on the budget day in the last 5 years and which sectors benefited the investors the most.
Budget 2021: Year of record growth
Budget 2021 was the first major budget after the Covid pandemic. Finance Minister Nirmala Sitharaman openly bet on infrastructure and health sectors in this budget. The result was that on the budget day, the Sensex jumped by about 2314 points or 5 percent, while the Nifty rose by a tremendous 4.7 percent. This was considered the best Budget Day performance of the last two decades. The infrastructure sector got a big benefit from the capex announcement of Rs 5.54 lakh crore. At the same time, due to emphasis on vaccination and health infrastructure, pharma and healthcare stocks also witnessed a strong rise.
Budget 2022: With speed comes fear
In the Budget 2022, the government continued to focus on Digital India and infrastructure, but the announcement of 30 percent tax and 1 percent TDS on cryptocurrency surprised investors. On the day of the budget, the Sensex closed up by about 849 points, but during the day a fall of up to 2000 points was also seen. Pharma, FMCG, metals, IT and realty sectors benefited from custom duty cuts and infra spending, while auto and oil-gas sectors remained under pressure.
Budget 2023: Growth focus, but market sluggish
The Budget 2023 was definitely growth-oriented, but the market did not take it with much enthusiasm. Sensex closed with a slight fall and Nifty also remained in the red. Concerns over fiscal deficit and rise in bond yields impacted PSU banks and the oil-gas sector. However, the green energy and infrastructure sectors got support from the capex announcement of Rs 2.4 lakh crore. Limited recovery was also seen in IT and pharma stocks.
Budget 2024: Tax spoils the game
The Budget 2024 was presented in July and was in the news due to the capital gains tax hike. The increase in short term and long term capital gains tax spoiled the mood of investors and a slight decline was recorded in both Sensex and Nifty. However, this budget brought good news for the jewelery sector. Due to reduction in custom duty on gold and silver, a rise of 5 to 7 percent was seen in jewelery stocks. Shares of construction and cement companies surged due to the big announcement of Rs 11.11 lakh crore on infrastructure.
Budget 2025: Muted reaction
Budget 2025 remained relatively quiet. The Sensex closed almost flat, while the Nifty declined slightly. Fiscal discipline and continued focus on infrastructure supported pharma, FMCG, IT and realty sectors. Textile sector benefited from custom duty cut, while auto, oil-gas and PSU bank stocks showed pressure from rising bond yields.
Which sector benefits the most?
It is clear from the Budget Day trend of the last 5 years that some sectors have consistently remained the first choice of investors. Let’s take a look at them-
- Infrastructure: The biggest beneficiary of the government’s capex focus every year.
- Pharma and Health: Continued strength since the pandemic, supported by R&D and health spending.
- IT & Tech: Steady returns from Digital India and technology push.
- Metals and Mining: Benefit from custom duty cut and infra demand.
- Realty and FMCG: Impact of urban-rural spending and infra boost.
- Jewellery: Great bounce from duty cut in 2024.
the way forward
History shows that there is bound to be ups and downs in the market on the budget day, but in the long run only those sectors win on which the government has policy priority. Special focus is expected on EV, green energy and infrastructure in the budget of 2026.
Latest Business News