Markets Rally Post Results Day, Experts Advise Investors To Focus On Infra Stocks

Market experts caution investors from indulging in any more panic-based selling. On Wednesday, the markets surged as the BJP moved ahead with its plans to form a coalition government

Experts pointed out that going ahead, the market will clock factors such as economic policies and cabinet formation.

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The stock markets on Wednesday rallied ahead in an attempt to recover the losses from the last trading session. The outcome of the Lok Sabha Elections 2024 refuted the claims made in the exit polls. Against the predictions of a comfortable majority in the range of 300 to 350 seats for the NDA alliance, the alliance managed to score a lead of more than 290 seats. 

However, the winning margin was disappointing for the party which contested the elections on the back of two consecutive ruling governments led by PM Narendra Modi. 

Market experts caution investors from indulging in any more panic-based selling. On Wednesday, the markets surged as the BJP moved ahead with its plans to form a coalition government. As of 12:54 PM, the S&P BSE Sensex gained close to 1,300 points and traded at 73,366.56, while the NSE Nifty50 jumped nearly 500 points to touch 22,323.15 in the session.

Expert Comments

Elaborating on the market movements, Gaurav Goel, SEBI registered investment advisor, noted, “The election results were declared yesterday and contrary to the expectations, the ruling NDA government has but struggled to cross over the line. However, it must be noted that their majority is thin but complete. This also marks the likely third term for Prime minister Narendra Modi which is a very credible achievement.”

Kranthi Bathini, Director - Equity Strategy, WealthMills Securities Pvt Ltd, explained that this volatility in the market was caused by the mixed election results. However, he pointed out that going ahead, the market will clock factors such as economic policies and cabinet formation.

Market Outlook And Advise For Investors

“The market is looking at the policy-making decisions of the NDA govt and the upcoming budget and how the cabinet is going to be, these are the factors that the market is initially looking at. The market might consolidate in the near to short term,” he explained on the outlook of the stock market. 

Goel also echoed the sentiments regarding the financial markets. “We remain extremely optimistic on stock markets over the long period of time. We expect the Government to continue on the path of economic reforms and the Indian economy should continue to prosper. However, hard reforms like land and labour would take a backseat. We feel that the fall makes the Indian market attractive from a fundamental valuation perspective. Those investors who are currently sitting on losses after yesterday’s massacre should continue to hold. They can rejig the portfolio and replace junk with quality. If investors have spare cash then they should start systematic buying over the next 6 months. SIPs should continue unabated,” he advised the investors.

Bathini also urged investors to continue investing in infrastructure as that should be the main focus of the new government. “One can buy stocks in consumer, capex, capital goods, and infrastructure, these stocks one can add on dips, that is the investor’s strategy, whatever the government is going to come, capex, infrastructure, focus is going to remain the same. So there is a greater emphasis on infrastructure development and capex spending. Making India a manufacturing hub remains the theme for the new government,” he explained.

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