The Indian stock market witnessed a steep fall tracking election results. Benchmark indices Sensex and Nifty declined over 8%, its steepest decline in more than four years. The market breadth firmly in favour of declines, as the advance-decline ratio stood at 1:14.
At close, the Sensex ended 4,389.73 points or 5.74% lower at 72,079.05 and the Nifty 50 settled 1,379.40 points or 5.93% at 21,884.50.
The Nifty Bank index tumbled 4,051 points to 46,929 and the midcap index fell 4,203 points to 49,151. Except FMCG, all indices slipped, the volatility indices rose up to 48%.
"The unexpected outcome of the general election sparked a wave of fear selling in the domestic market, reversing the recent substantial rally. Despite this, the market maintains its expectation of stability within the coalition, led by BJP as the major election winner, thereby mitigating substantial downside in the medium-term. This is likely to lead to a major shift in political policy with a focus on social economics, which will have a positive effect on the rural economy," said Vinod Nair, Head of Research, Geojit Financial Services.
Alongside, the sectors that have topped in the past five years, including power, capital goods, real estate, and industrials, are advised to exercise caution in the near term, Nair said.
"Nevertheless, the long-term growth prospects for these sectors remain robust," he added.
The BJP-led National Democratic Alliance was inching closer to the 300-mark, but appeared to be falling short of the overwhelming majority forecast by most exit polls, as vote count for the 543 Lok Sabha seats heated up on Tuesday.
At close, the Sensex ended 4,389.73 points or 5.74% lower at 72,079.05 and the Nifty 50 settled 1,379.40 points or 5.93% at 21,884.50.
The Nifty Bank index tumbled 4,051 points to 46,929 and the midcap index fell 4,203 points to 49,151. Except FMCG, all indices slipped, the volatility indices rose up to 48%.
The BSE-listed companies have now lost over ₹30 lakh crore in market capitalisation.
"The unexpected outcome of the general election sparked a wave of fear selling in the domestic market, reversing the recent substantial rally. Despite this, the market maintains its expectation of stability within the coalition, led by BJP as the major election winner, thereby mitigating substantial downside in the medium-term. This is likely to lead to a major shift in political policy with a focus on social economics, which will have a positive effect on the rural economy," said Vinod Nair, Head of Research, Geojit Financial Services.
Alongside, the sectors that have topped in the past five years, including power, capital goods, real estate, and industrials, are advised to exercise caution in the near term, Nair said.
"Nevertheless, the long-term growth prospects for these sectors remain robust," he added.
The BJP-led National Democratic Alliance was inching closer to the 300-mark, but appeared to be falling short of the overwhelming majority forecast by most exit polls, as vote count for the 543 Lok Sabha seats heated up on Tuesday.
First Published: Jun 4, 2024 4:25 PM IST
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