Election Results 2024: Top Stocks Surge As I.N.D.I.A Bloc Leads With 230+ Seats
Election Result 2024 Stock Market Crash:?After a rally of over 2,500 points in the previous session, driven by exit polls predicting a clear Modi-led NDA win in the Lok Sabha elections, Indian markets saw a massive correction on Tuesday, 4th June, the day of the 2024 election results. However, some shares like Hindustan Unilever, Dabur India, and Avenue Supermarts Ltd were among the top gainers on Tuesday. These stocks rose even as the Sensex crashed more than 4,000 points due to trends showing the I.N.D.LA bloc winning 230 seats. According to ECI data, the BJP-led NDA is leading with 296 seats. Marico, Britannia, Max Healthcare, Hero MotoCorp, Page Industries, and Nestle also showed gains on the BSE.
The stocks that showed gains on the BSE include:
- Hindustan Unilever: +143.05 (6.07%)
- Dabur India: +36.00 (6.61%)
- Avenue Supermarts Ltd: +228.70 (5.26%)
- Marico: +21.05 (3.54%)
- Hero MotoCorp +163.40 (3.17%)
- Britannia: +162.20 (3.14%)
- Max Healthcare: +12.00 (1.57%)
- Page Industries: +456.35 (1.26%)
- Nestle: +1.20 (1.24%)
READ ALSO: Netizens Share Funny Memes As Lok Sabha Election Result Trends Cause Share Market Chaos
Why is the Indian stock market falling today?
As per Suman Bannerjee, CIO, Hedonova, a combination of political stability with promises of reforms, improving economic conditions, and supportive global factors like quantitative easing by developed markets fueled a strong rally in Indian stock markets since May 2014. This surge led to over Rs 300 lakh crore in investor wealth, reflecting growing confidence and participation. The future trajectory hinges on the new government's economic policies, with factors like GDP growth, inflation, and global conditions playing a key role. Investors should be prepared for volatility due to currently high valuations and adopt a diversified approach.?
Here are the key reasons for the market's reaction:
Election Results Diverging from Exit Polls: The exit polls had predicted a strong win for the NDA, which would have been seen as a continuation of the current economic and political policies. However, the actual trends showed the I.N.D.LA bloc gaining significant ground, with the NDA's lead being less pronounced than expected. This unexpected shift created uncertainty about the future political landscape and policy direction.
Investor Sentiment and Uncertainty: Stock markets generally dislike uncertainty. The closer contest and the possibility of a less stable government have made investors jittery. This uncertainty can affect economic reforms, foreign investment, and overall economic stability, leading to a market sell-off.
Profit Booking: After a significant rally in the previous session driven by exit poll predictions, some investors might be engaging in profit booking. This means they are selling stocks to lock in gains made during the rally, contributing to the downward pressure on the market.
Sector-Specific Reactions: Certain sectors and companies are more resilient or attractive to investors during uncertain times. For instance, consumer goods companies like Hindustan Unilever, Dabur India, Colgate, and Avenue Supermarts Ltd., along with others like Marico, Britannia, Max Healthcare, Hero MotoCorp, Page Industries, and Nestle, showed gains. These companies are perceived as safer investments due to their stable demand and strong market positions.
Global Market Influences: Sometimes, global market trends and economic indicators can also impact local markets. Although the primary reason here is domestic political uncertainty, any negative global cues could exacerbate the situation.
READ ALSO: Adani Stocks Crash, Ambani Led Reliance Shares Dip 7% Over Election Result Uncertainty- Details
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