Exit polls released after voting in many states have shown a slight lead to BJP in both West Bengal and Assam, due to which the trading session can be quite hectic when the stock markets open tomorrow. In Assam, two major exit polls have predicted an easy victory for the BJP-led NDA. Axis My India projected 88-100 seats for the BJP, while JVC gave a similar range of 88-101 seats in the 126-member assembly. Congress and its allies appeared to be lagging behind with projections of fewer seats. More than 85 percent voting was also recorded in the state, which shows the strong participation of the people.
Exit polls in West Bengal were more varied, but most were pointing towards BJP's lead. Pollsters such as Praja Poll, Poll Diary, Matriz and Chanakya Strategies projected the party crossing the majority mark, with estimates ranging from 142 to more than 200 seats. Let us also tell you what kind of results can be seen after the exit poll results.
Despite the political importance, early market signals are cautious. GIFT Nifty was trading over 100 points lower, indicating a dull to negative start for domestic equities on Thursday. Experts say that although exit polls often bring short-term fluctuations, their major impact remains limited. Garud Investment Managers AVP Vishnu Tripathi said in an ET report that such developments prompt investors to reassess their positions based on the expected policy direction at the state level. He said that the results of state elections impact the priorities of regional policy execution, spending on infrastructure and industrial development. Local impacts may be visible on sectors like banking and infrastructure, depending on which party forms the government.
However, he also said that the broader direction of the market is determined by macro economic factors such as earnings growth, inflation and interest rates rather than state-level political changes. The environment for the markets remains mixed. On Wednesday, the benchmark index made a strong comeback. Sensex rose more than 600 points and Nifty closed above 24,100. This was supported by value buying and optimism about companies' earnings. FMCG, auto and telecom shares led the gains, while bank and power shares remained sluggish. Experts said that the main reason for this rise was the strength in the earnings of companies rather than major economic or political reasons. Hariprasad of Livelong Wealth said in the ET report that the main reason for this was earnings. The strong results boosted confidence in domestic demand and balance sheet strength.
However, global signals still remain a matter of concern. Crude oil prices are at a high level of around $110 per barrel, money from foreign institutional investors is continuously going out and the rupee is also weak. All these factors are still weighing on market sentiment, limiting the scope for any sustained upside. From a technical point of view, the market is currently standing at an important juncture. Rupak Dey, Senior Technical Analyst, LKP Securities, said in the media report that Nifty has held the important support level, but there is no clarity regarding its direction right now. Given this situation, the market reaction to the exit polls is likely to be selective rather than comprehensive. There may be some movement in stocks related to infrastructure, government spending or regional impact, but overall the movement of the index is expected to be decided by global cues and the pace of earnings of companies.
