In the last five years, the Indian equity benchmark indices have fallen once in the entire month ahead of Union Budget announcements. The entire month's performance just before the Budget announcement every year is important because it indicates the market's sentiment, and this year it appears to be gloomy.

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Most of the parameters this time are not in favour of the Indian equities as third-quarter earnings so far have remained muted, coronavirus continues to spook the global markets and the Indian economy is still at a precarious state.

The Street this time is expecting bigger reforms from Finance Minister Nirmala Sitharaman to plug the economic loopholes. A cut in personal income tax rates tops the list of expected reforms.

After January 2016, it's the first time that the Sensex and Nifty50 have given negative returns a month before the Budget. This year, in the month of January so far, Sensex and Nifty50 have slipped 1 percent and 1.33 percent respectively.

Interestingly, in the last 10 Union Budgets, Sensex and Nifty have fallen 6 times in the pre-Budget week.

Last year, on July 5, 2019, FM Sitharaman presented the first budget after the Narendra Modi-led government's return to power in general elections held in May. The Sensex fell as much as 1.17 percent during the session before ending 0.99 percent lower for the day. The sentiment remained negative mainly after minimum public shareholding was increased to 35 percent from 25 percent.