Maharashtra elections 2024: Sensex surged over 1,000 points while Nifty moved past 23,750, ahead of Maharashtra election voting. Stocks gained amid strong global cues and expectations that the BJP-led ruling coalition has edge over other parties in the assembly elections, thanks to populist measures announced in the run-up to the poll day.
Stock exchanges will be shut on Wednesday on account of elections in the state. Voting will begin from 7 am in Maharashtra's 288 assembly constituencies.
The trends are mixed and can create some volatility in the market, but the election outcome should not be the key reason for investing decision, said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.
"If BJP and its allies are coming to power, it is positive for the market. If not, it would be a neutral event for the market. The market is unlikely to overreact to the election outcome."
Sensex was trading at 78,339.31, up 1,000 points or 1.29 per cent. Nifty was trading at 23,750.05, up 296.25 points or 1.26 per cent. Midcap and smallcap indices advanced up to 2 per cent. Bathini said midcap and smallcap pockets are certainty not looking attractive, but by and large they have always been stock-specific segments.
As per media reports, Phalodi Satta Bazar expects BJP to win 87 to 90 seats. The BJP-led alliance Mahayuti is seen getting 144-152 seats -145 seats are needed to form government, ZEE reported.
Nomura India last week noted that political parties in the fray are not only fighting their rival coalition parties, but are also looking to reassert their authority among partners in their own coalition. It said the BJP-led ruling coalition looks to have the edge following the announcement of populist measures
"Some commentators we met believe that the increasing popularity of freebies at the state level suggests BJP’s traditional aversion to them is on the decline, and there is a risk that some measures may be adopted by the central government in coming years, albeit this is not a given and needs to be monitored," it said. Emkay Global in a note earlier on October 30 said the Maharashtra election results would set the tone for national elections and the impact would not just be regional, winner from either side would have an upper hand in national politics and greater confidence going forward to 2029.
"A BJP-led alliance victory would signal policy continuity with emphasis on infrastructure and capex. A Congress-led alliance victory would drive a pivot to rural spending and a possible slowdown of some key infra projects. The fiscal discipline would be to watch out for, given the looming state debt on Maharashtra and two decades of financial indiscipline," it said.
In case of a hung or close assembly, political realignment could be a potential outcome, if there is a hung assembly or the total seats of each alliance is similar, Emkay said earlier.