Union Home Minister Amit Shah emphasized in an interview that while the stock market should not be directly correlated with elections, a stable government can create a conducive environment for its performance. On a lighter note, he even suggested that the market might see an upsurge after June 4, anticipating a favorable outcome for the BJP and its allies in the Lok Sabha elections.
The seven-phase elections will conclude with the counting of votes on June 4. Mr. Shah addressed rumors linking share market corrections to the BJP’s performance by noting that similar market corrections have occurred on 16 previous occasions.
Mr. Shah emphasized that stock market crashes shouldn’t be associated with elections. However, if such rumors have circulated, he advised investors to consider buying shares before June 4, suggesting that the market is poised to rise at that time.
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Mr. Shah declined to speculate on whether the Sensex would surpass the one lakh-mark, but he did highlight that the stock market tends to thrive under stable governmental conditions.
He also expressed confidence in the BJP’s electoral performance, anticipating over 400 seats and the establishment of a stable Modi government. He asserted that this would likely result in a rise in the stock market or share market.
The BSE index, reflecting the performance of the country’s top 30 companies, dipped below 72,000 after experiencing a drop of over 700 points in early trading on Monday. Previously, on May 3, it had achieved a milestone by surpassing the 75,000-mark, marking its highest ever level.
Investor sentiment significantly influences share markets, leading to connections between political developments, elections, and equity performance. Analysts have linked recent corrections to factors such as significant selling by Foreign Institutional Investors, increasing US bond yields and rate adjustments, as well as substantial sell-offs.
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