Stock Investors In Wait-and-watch Mode Ahead Of Poll Outcome; Indices in Red

On Wednesday morning, Indian stock indices consolidated from where they were at the previous session closing. After a stellar rally over the past few weeks, markets faced some resistance this week.

In the early trade, Sensex was at 74,906.69 points, down 263.77 points, or 0.35 per cent, and Nifty at 22,800.50 points, down 87.65 points or 0.38 per cent.

"The nervousness in the market continues with uncertainty regarding the election results," VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

"An important sustaining trend during this uncertain phase is the continuous buying by DIIs which has reached around Rs 45,000 crore so far this month. This can be interpreted as a reflection of expectation of political stability after the election results."

Investors are now in a wait-and-watch mode ahead of the Lok Sabha outcome.

It is now expected that further upmoves will depend on the cues from the exit poll estimates, various macroeconomic data that are scheduled later during the week, Q4 India GDP, and US inflation data.

India's GDP grew at a massive 8.4 per cent during the October-December quarter of the financial year 2023-24, and the country continued to remain the fastest-growing major economy. India's economy grew 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22, respectively.

Lately, barring this week, Indian stock indices continued their rally, reaching fresh lifetime highs, tracking strong global market cues, hopes of Prime Minister Narendra Modi's comfortable return to office, besides other strong macroeconomic fundamentals.

With the six phases of elections now behind us, it is widely expected by investors that the Narendra Modi-led government will come back to office with a comfortable margin for his third term. This also likely triggered fresh stock buying.

Emkay Investment Managers expects Indian Nifty to reach 24,500 by December 2024. Indian Nifty is expected to further scale in upward mobility to surpass the level of 26,500 by December 2025.

In the immediate near term, markets are going to focus on election results, Emkay said in a webinar.

"An expected return of the NDA regime with a base case scenario of 330 seats will result in policy continuity along with major reforms on land, labour, and judiciary will support positive sentiment in the Indian markets," Emkay said. (ANI)