Assembly Election Results 2018: If BJP win comes in Madhya Pradesh, this is how Sensex, Nifty will react
BJP is facing anti-incumbency in all three major states Madhya Pradesh, Rajasthan and Chattisgarh.
Assembly Election Results 2018: Each minute the markets are getting tensed as the counting in assembly elections show 'ache din' not coming for BJP. What has happened is that both Sensex and Nifty are on hotbed by losing more than 500 points and 150 points respectively, as exit polls indicated that Prime Minister Narendra Modi government will not see a big win in these assembly elections whose votes are being counted at present. With today's trends showing Congress leading in Madhya Pradesh, Rajasthan and Chattisgarh, the problems for BJP and markets have increased. BJP is facing anti-incumbency in all three major states Madhya Pradesh, Rajasthan and Chattisgarh. The other two states whose elections results will be announced are Telangana and Mizoram.
It is quite clear, that both Congress and BJP do not stand a chance in Telangana and Mizoram as citizens have voted heavily for their local parties namely Telangana Rashtra Samithi and Mizo National Front.
In Rajasthan and Chattisgarh, Congress is in lead with high margins. In these two states, Congress led by Rahul Gandhi is leading in 101 seats and 57 seats, compared to that of BJP, which is leading in 85 seats and 25 seats respectively.
Interestingly, the only hope which was left for a BJP win was in Madhya Pradesh. Looks like even that will be snatched away.
Before 1030 hours, BJP had a small lead in Madhya Pradesh, leading in 112 seats, higher by 2 seats from Congress, which has 110 seats. But that changed as tables have turned, now Congress has taken lead even in MP with 116 seats while BJP has 101 seats.
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Be that as it may, if a BJP win ultimately comes in Madhya Pradesh, then markets are going to react positively on the outcome.
If BJP wins MP and Chattisgarh: Its Positive and Nifty to touch 10500-10600 again. Similar is the case of Sensex as well.
According to Standard Chattered, Investors are expected to remain risk averse ahead of the outcome of key state elections that may set the tone ahead of the national ballot in 2019. Out of the five, the outcomes of Rajasthan and Madhya Pradesh are considered the most crucial barometers of people’s acceptance of the policies of the NDA government at the Centre.
Coming back to MP, the BJP has been in power for the last 15 years and is facing high anti-incumbency, are likely to see a close finish.
The BJP party during the elections have also focused on specific infrastructure projects like large greenfield roads in MP, apart from farm loan waivers, employment and pensioners.
Hence, a Madhya Pradesh win for BJP is a must for markets to rebound.
However, CLSA predicts of the seven exit polls available so far, five are predicting a win for the Congress, while the other two are showing a BJP win in MP.
CLSA adds, margin of victory is thin for both parties in all the polls. At an average, BJP is expected to win 109 seats and Congress 113. The majority is 116 and in a hung parliament situation, the BSP which is the key third party could play an important role.
At around 1103 hours, Sensex is trading at 34,704.29 down by 255.43 points or 0.73%, whereas the Nifty 50 is below 75.45 points or 0.72% trading at 10,413.
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