Amit Shah urges to buy stocks before 4 June
Amit Shah urges to buy stocks before 4 June
In terms of the reform agenda for the next five years, Nomura sees a sustained focus on infrastructure spending and a manufacturing push.
Amit Shah says that so long as BJP wins a majority of seats in the Lok Sabha again (>272 seats), markets should still view the outcome of India’s General Elections positively over time,
In the midst of speaking to the media channel on Monday, he said that one must not connect the recent stock market movements to general elections 2024 while advising to stock investors before June 4″, the date for Lok Sabha election outcome, expecting the domestic stock market to shoot up going ahead.
He went on to add that can’t anticipate stock market moves, but, normally whenever a stable government is formed at Centre, the market sees a rally.
He sees 400-plus seat wins (BJP/NDA), a stable Modi government coming, and thus market rising,” Shah told NDTV.
Amit Shah’s comments came on a day when the fourth phase of ongoing elections was underway and the stock market benchmark Nifty was down for sixth of the last seven sessions. Shah seemed unfazed by the prevailing market uncertainty over the poll outcome.
Nomura India cited recent opinion polls to suggest a BJP win and policy continuity post 2024 general elections.
Nomura in terms of the reform agenda for the next five years, sees a sustained focus on infrastructure spending and a manufacturing push, alongside fiscal consolidation.
The government may focus on the more politically contentious reforms around the factors of production including land, labour and capital; judicial reforms; and simplifying direct and indirect tax administration, including bringing electricity, oil and gas and alcohol under the GST ambit. The government is also likely to further focus on improving the ease of doing business for foreign investment and laying the groundwork for next generation sectors,” it said.
On the other hand, MUFG Bank, noted that while it almost seemed like it was a “done deal”, with the overwhelming consensus by political observers and polls agreeing on a likely strong win by the incumbent BJP government, a lower voter turnout in the first 3 phases of the elections have increased perceived uncertainty on the outcome, even if the consensus is still firmly rooting for a return of the incumbent.
As per MUFG Bank this weakness should reverse over time as there will still be policy continuity in crucial areas such as infrastructure, investment attraction, fiscal consolidation, and inflation management in such a scenario.
MFUG also stressed that “Conversely, a greater seat share win by the BJP compared with 2019 (>303 seats) would increase the ability to pass more contentious structural reforms in land, labour and the agriculture sector, and will be perceived much more positively by markets, with INR FX and risk assets likely rallying in the aftermath.
According to Amit Shah, Union Home Minister, if BJP comes to power, Mirae Asset said all eyes will be on the July Budget to see if there are some changes in direct or indirect taxation, MSP policy, and MGNREGA payments. In he long-term, the focus would be on infrastructure development, farm laws, skill development, and creating employment on the manufacturing side to spur demand from rural India, Mirae Asset Capital Markets said.
Last week, PhillipCapital said it sees a strong rally if the BJP-led NDA hits the much-publicised 400-plus target. “If a lower 300-330 seats for the NDA results in a knee jerk market reaction (a fall), we would treat it as a buying opportunity. A further worsening of voter turnout in the following election phases could have a bearing on election outcome and equities – so we would keep a close watch,” the domestic brokerage said in its note.
News Edit K.V.Raman
