Slender win for NDA queers pitch for street, investors lose ₹31 trillion
₹31 trillion on Tuesday, as the national vote count belied predictions of punters, pollsters and politicians. The Nifty and Sensex plunged the most in four years as it became clear that the Narendra Modi-led Bharatiya Janata Party (BJP) will fall short of the 272 seats required to form a government on its own. While the BJP-led NDA secured a comfortable majority, the numbers were far below Modi's call for 400 seats, and exit poll predictions of above 350.
At press time, BJP was leading in 241 seats, and NDA in 294 seats. Also read: INDIA heat wilts lotus, coalition saves the day The Nifty plunged 5.93% to 21884.5, its worst fall since its 12.98% crash on 23 March, 2020, a day before the nation entered the first pandemic lockdown. The Sensex tanked 5.74% to 72079.05, the most since 4 May, 2020.
The selling was led by foreigners who sold a whopping ₹12,436 crore worth of shares and mounted bearish futures positions, provisional BSE data showed. Local institutions sold ₹3318.98 crore of shares. While market experts do not expect any drastic change in economic trajectory, they believe stocks will remain turbulent until clarity emerges on government formation, and investors digest Tuesday's rude surprise.
Bluechips like Reliance Industries, HDFC Bank, ICICI Bank, L&T and SBI, which fell 5-15%, contributed over half of Nifty’s 1379-point correction. Nifty Midcap 150 and the Nifty Smallcap 250 fell by the most in four years to 18476.25 and 14761.1, deepening investor wealth erosion. “Most of the poison is out, after Tuesday’s correction," said Raamdeo Agrawal, co-founder and chairman of Motilal Oswal Group, when asked about the market direction.
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