Reduce trading size today: Nithin Kamath advises traders for Budget 2025

Budget 2025: Zerodha co-founder and chief executive officer, Nithin Kamath, has shared his insights into how stock market traders should trade today

Budget 2025, Stock markets today: Finance Minister Nirmala Sitharaman will present the Union Budget 2025, today, i.e Febraury 1, 2025, at 11:00 AM. India Stock Markets, meanwhile, are open today, February 1, 2025, for a special trading session. 

Stock market investors, on their part, are waiting for Budget 2025 proposals as announcements made during the Union Budget 2026-26 speech and the Budget analysis thereafter will guide the impact on Sensex, Nifty in the near-term. 

Historically, periods around the presentation of the Union Budget keeps stock markets volatile as Budget proposals play a crucial role in shaping investor sentiment. 

The document provides future roadmap of the country's income and expenditures, laying out capital allocations for various sectors. This year, too, investors are waiting to see how the Narendra Modi government will use Budget 2025 as a critical catalyst to stimulate the Indian economy’s growth and, thereby, the Indian market.   Stock Market Live Updates 

In this backdrop, Zerodha co-founder and chief executive officer, Nithin Kamath, has shared his insights into how stock market traders should trade today. 

In a post on social media platform 'X', Kamath said stock markets are bound to be volatile on Budget day, February 1, so trade with caution. 

"If you are an active trader, I guess you should reduce trading size during event days. That is, if you cannot stop yourself from trading," he advised investors on 'X', formerly Twitter. 

Market Trends on Budget Day

According to a Business Standard report, stock markets was subdued on the last three Budget days, with the Nifty closing with marginal losses up to 0.3 per cent. Overall, the Nifty has delivered a negative return in 5 of the 7 Budget Days, presented by finance minister Nirmala Sitharaman. 

Under FM Sitharaman's tenure, Nifty clocked its biggest Budget Day gain on February 01, 2021 - up 4.7 per cent or 646 points - as the index climbed to 14,281. On the flip side, the biggest fall was witnessed on February 01, 2020, when the Nifty dropped 2.5 per cent or 300 points to settle at 11,811. READ MORE

Indian Stock Market Budget 2025

Thus, if you are a trader looking to trade on Budget Day today, technical analysts have suggested key levels for Nifty and Bank Nifty indices today. 

Both Nifty and Bank Nifty indices, as per Anand James, chief market strategist at Geojit Financial Services, have signalled further uptrend, even though they exhibit different chart patterns.  

"Nifty’s bullish engulfing candle on the weekly charts as well as a two-week high breakout encourage us to look beyond 23,480, hitherto assumed to be an end point to the ongoing uptrend, and aim for 23,700-840. We would place our downside marker at 23,380 for aggressive longs, with preparedness to switch sides only after a few hours’ trade below 23,190," he said. 

Nithin Kamath, meanwhile, has said that discount broking app Zerodha is, probably, the only broker which will allow investors to do BTST (Buy today and sell tomorrow) trades on days of settlement holiday, like today.  

"So, there are no restrictions; you could buy something today and sell it today," he said. 

Budget 2025 Expectations

The market will be looking for growth stimulating measures; not market-related taxation reliefs like changes in the capital gains taxation, according to analysts. 

"A major expectation from the Budget, analysts said, is a cut in personal income tax to provide relief to the middle class and boost consumption, thereby facilitating growth recovery. The extent of the tax relief remains to be seen. The fact is that there is no fiscal space for big relief," said V K Vijayakumar, chief investment strategist at Geojit Financial Services.