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Stability or political instability may well have an impact on markets. Five states are vying for polls – Madhya Pradesh, Chhattisgarh, Rajasthan, Mizoram and Telangana – in anticipation of the general elections of 2019.
Polls clearly show the loss of the BJP in Rajasthan and a very harsh struggle between the MP and the Chhattisgarh. Telangana also does not seem to be a step forward for the TRS after the congress, experts suggest, according to the TDP alliance.
But the outcome of the elections in Madhya Pradesh, to be held at the polls on November 28, will be important for D-Street, Prabhudas. Lilladher said in a report.
"The results of the polls in Madhya Pradesh are the most critical event of the current year, given the strong reach of the ruling party. If the ruling BJP does not retain this state, it could sound the alarm and give rise to major upheavals in the general elections of 2019. "
The BJP swept these states into the previous Vidhan Sabha with 377 / 520 seats and Lok Sabha with 59/66 constituencies Political realignments are likely to happen quickly in the next few months
"The political scenario seems difficult and much depends on how alliances in the key states of 39, UP, Bihar and Maharashtra come to fruition in the 2019 elections, "the report says.
The report adds that the emergence of the united-front and back-seat systems as in 1996 could scare the markets, pay attention to the movements of a "third exploitable front"
any strong government, be it led by the BJP or by Congress.According to the report, a 1996 arrangement prevo "As the third front is at the helm and led by Congress could be negative," adds Prabhudas Lilladher, who estimates that Nifty will receive significant support at 10,000. "We see markets being in the US. interval. A strong government led by the BJP after the 2019 elections will bring the markets to about 12,500, while a weak third government will put it to the test of 9,500, "he said.
If we rely on history, it is obvious that the election results in the states can scare the market behavior before the general elections of 2019. We can expect
Although election results are one of the major factors of volatility, macroeconomic issues and high valuations are also the cause of the problems. how corporate profits will materialize in the coming quarters.
"Investors will scrutinize elections in the states with the utmost attention to develop likely scenarios for the results of the polls. However, it is widely accepted that public opinion and the considerations governing national and general elections diverge and that, consequently, these results can not be extrapolated, "Moneycontrol Siddharth Bothra Senior President and Fund Manager at Motilal Oswal AMC.
investors should be prepared for increased volatility in the event of big surprises in both directions compared to consensus expectations. And the main catalyst of the market must be the resumption of earnings growth, which continued to disappoint overall, even during the first half of the year 19. "he declared.
Elections to the 2018 Assembly: read the latest news, opinions and badyzes here
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