Will markets crash if BJP loses Haryana, J&K, Maharashtra, Delhi state polls? | News on Markets

That said, a complete washout of the BJP in all state polls – Haryana and J&K now, Maharashtra (polls likely in November) and Delhi (likely in February) could trigger a temporary knee-jerk reaction, they believe.

Markets, according to G Chokkalingam, founder and head of research at Equinomics Research, took cues from the outcome of Lok Sabha polls and to that extent, they are already discounting what may happen now in the state elections. 

“Except Maharashtra, all other states are small in terms of number of Lok Sabha seats; hence, the impact of election results of these states would have a minimal impact on the markets. At this stage, how crude oil prices behave due to the ongoing geopolitical situation in West Asia would be more relevant for movement of the domestic markets,” he said.

Meanwhile, exit polls predict Congress’ return to power in the 90-member Assembly in Haryana after nearly a decade. However, J&K is likely to witness a hung house, exit polls suggest, with the National Conference-Congress alliance likely to emerge closer to the majority mark of 46.

“The markets have priced in the outcome of the state elections to a large extent. However, Maharashtra remains key. A loss there could trigger a negative reaction. Over the next few days, however, the markets have a lot of other things to worry about such as the geopolitical conflict in West Asia, outcome of the Reserve Bank of India’s (RBI’s) policy and then the corporate results season. All this could keep the markets volatile in the near-to-medium term,” suggests Ambareesh Baliga, an independent market analyst.

Farm politics & state elections

That said, the outcome of the state polls, especially in Haryana and Maharashtra, analysts believe, are also important from ‘farm politics’ viewpoint, and how the central and the state governments deal with the farmer’s demands. 

From a technical standpoint, the Sensex, analysts said, has a significant support near the 100-day moving average (DMA) level of 79,572 levels.

“With the overall bias and sentiment precariously placed, the Sensex would need a decisive move above the important 20-DMA level of 83,400 to gain momentum. The support for the week is seen at 79,800 levels for the Sensex and at 24,400 levels for the Nifty. These indexes face resistance 83,500 and 25,600 levels, respectively,” said Vaishali Parekh, vice president for technical research, PL Capital – Prabhudas Lilladher.

First Published: Oct 07 2024 | 11:05 AM IST