Bloodbath in India stocks; Sensex slumps over 4,000 points
New Delhi: Indian stock indices witnessed a bloodbath on the day the Lok Sabha results are being announced, where incumbent BJP performed below par and seems it may fall short of exit poll predictions and the majority mark on its own.
The BJP-led National Democratic Alliance is leading in nearly 300 seats while the INDIA alliance is leading in 229 seats, as per data from the Election Commission of India.
The idea of a coalition government lead by BJP at the centre has led to widespread market anxiety and a sharp decline in stock indices.
The BJP, which has been the dominant force in Indian politics for the past decade, is seen as a pro-Industry party whose policies have generally favoured economic growth and market stability.
The failure to secure a clear majority to BJP of its own raises concerns about the formation of a stable government and the continuation of economic reforms.
At the closing bell, Sensex closed at 72,079.05 points, down 4,389.73 points or 5.74 per cent, while Nifty closed at 21,884.50 points, down 1,379.40 points or 5.93 per cent.
All Nifty sectoral indices, barring Nifty FMCG, were deep in the red today. Nifty metal, Nifty bank, Nifty financial services, Nifty PSU bank, Nifty private bank, Nifty realty, Nifty oil and gas, slumped the most, NSE data showed.
"The steep fall is due to the results so far falling short of the exit polls which the market had discounted yesterday. If BJP doesn't get a majority on its own there will be disappointment and this is getting reflected in the market. Also it is possible that Modi 3.O may not be as reform-oriented as the market expected and may turn more welfare-oriented," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
At one point during the afternoon, Indian equity indices plummeted over 8 per cent on Tuesday, as poll trends indicated a closer than anticipated fight for the incumbent Narendra Modi-led NDA government.
Sensex logged it worst session in over four years, which it witnessed back during Covid days.
(ANI)
