MUMBAI: The stock market commenced trading on a slightly positive note today, buoyed by the BJP’s victory in the recent general elections, marking their third consecutive term. The Sensex and Nifty opened nearly 1 per cent up. Among the Nifty companies, 40 showed advances, and 10 recorded declines.
From the Nifty firms, Hindustan Unilever, M&M, Britannia, ONGC, and HCL Tech emerged as the top gainers. Conversely, Hindalco, Powergrid, L&T, Adani Enterprises, and Adani Ports were the top losers.
Shrikant Chouhan, head of equity research at Kotak Securities, provided insights into the current market trends and said, “The current market pattern indicates a consolidation phase within a broader trading range of 22,300 and 21,300. It is advisable to consider taking a contra view of going short or long around given levels. Above the 22,300 level, resistance is expected around the 50 and 20-day SMAs, positioned at 22,400 and 22,500 levels. Gradually, reduce long positions at each resistance level”.
Following a significant downturn on Tuesday, where the equity market saw its most substantial single-day decline in over four years, India’s primary indices, the Sensex and Nifty 50, rebounded today.
The previous day’s decline was driven by election tabulation results indicating challenges for the ruling BJP in securing a majority. Despite the BJP-led National Democratic Alliance (NDA) leading in over 290 seats, slightly above the 272 required for a majority, it fell short of the approximately 350 seats won in the 2019 election.
This narrower-than-expected victory raises concerns about the new government’s ability to enact reforms vital for sustaining domestic economic growth.
Varun Aggarwal, founder and managing director, Profit Idea, said, “Technical analysis indicates a bearish sentiment, with the Nifty forming a significant Bearish candle on the daily chart, signaling potential further declines if it remains below 22,222. Derivative data reflects mixed sentiments, with specific stocks showing positive setups while others exhibit weakness”.
In global markets, European stocks declined as investors weighed concerns about the US economy against expectations of early Federal Reserve policy easing. Meanwhile, most Asian markets, including Japan, South Korea, and Taiwan, experienced declines, driven by signs of weakness in the US economy and uncertainty surrounding the Indian election outcome.
Despite the BJP’s election victory, the stock market’s slightly positive opening reflects cautious optimism amid broader concerns about the new government’s ability to implement crucial economic reforms. Investors and analysts will closely watch market movements and political developments to gauge future trends. (ANI)