Budget 2025: Here are the top 5 triggers for markets ahead of the budget announcements

Indian markets are expected to open positive on Saturday, February 1, ahead of the Union Budget. The equity benchmark indices posted a strong recovery during the week, rising nearly 3.2% from the recent lows. The broader market indices recovered more fiercely, rising 5% from the lower levels.

On the global front, the US markets fell from near-record high levels on Friday after the US government confirmed imposing tariffs on China, Mexico, and Canada.

Tax rationalisation

The key budget announcements will remain the major trigger for the market throughout the day as market participants and investors expect announcements of populist measures like tax relief, stimulus for industries and more. The markets are likely to respond to these measures during the budget session.

Tariff headwinds The Trump administration confirmed imposing tariffs on China, Mexico, and Canada as early as this month, adding worries to the global financial markets. Following this development, the US markets fell from record highs. The Dow Jones, S&P500 and NASDAQ declined 330 points, 30 points, and 54 points, respectively on Friday.

Consumption and PSU stocks to remain in focus

Amid the high optimism surrounding the budget announcements, stocks in consumer durables, Auto, Banks, and Real Estate will likely remain in focus on Saturday. The NIFTY consumer durable, NIFTY FMCG, NIFTY Financial services, NIFTY Realty, and NIFTY Auto were the top sectoral gainers on Friday.

FII short position

Foreign insitutional investor's (FII) position in the derivatives segment remained largely unchanged on Friday. FIIs hold nearly 1.75 lakh contracts in short, and the long: short ratio stood at 11:89. The higher short position by the FIIs indicates their pessimistic outlook on Indian markets ahead of the key the budget.

Gold touches record-high

Gold prices touched record-high levels on Friday at $2,817 per ounce after global markets fell on tariff jitters. The Trump administration confirmed that tariffs on China, Canada and Mexico will be in place in February. According to market experts, gold prices are expected to remain elevated amid heightened global market uncertainties.