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BJP’s triumph in national elections strengthens consensus for 2024, boosts market sentiment: analysts


A decisive victory for the ruling Bharatiya Janta Party (BJP) in three of the four national elections held has boosted confidence in Indian markets.

The BJP dethroned the Congress in Rajasthan and Chhattisgarh while retaining the state of Madhya Pradesh with a bigger majority.

Analysts across the spectrum believe that the national election results reinforce the consensus that the Narendra Modi-led government will return to power after the Lok Sabha elections in 2024 as well.

Here’s a look at what they had to say:

BoFA Titles

A better-than-expected result for the BJP strengthens political continuity at the center in 2024, according to BofA Securities.

The brokerage said that while the government has announced some populist measures and more could be announced in the run-up to the election, it does not see this having an impact on the government’s fiscal consolidation trajectory.

He expects the country’s budget deficit to remain on track to meet its 5.9% target for fiscal 2024, thanks to better-than-expected tax revenues.


Nomura analysts wrote in their note that the national election result suggests that the current BJP government retains the support of the electorate in states where it performed well in the 2019 general elections.

The bulk of the BJP’s seats were concentrated in the large states of northern and western India.

In most of these states, the BJP won a significant number of seats, leaving little room for improvement.

Motilal Oswal

Motilal Oswal also highlighted the fact that the market will now enter a pre-election rally, where the Nifty 50 has returned between 10% and 35% to investors in the six months preceding the general elections in each of the previous five instances to from 1999. .


Brokerage firm CLSA said it expects the central and state governments to combat agricultural inflation or agflation through price and subsidiary controls.


The BJP’s victory in three states is much better than exit polls suggested and it reinforces the consensus expectation of a Modi wave in the 2024 elections as well, Jefferies said in a note.

The brokerage said the renewed investor confidence should bode well for domestic cyclical sectors.

Among sectors, Jefferies is bullish on banks, industrials, energy, real estate and mid-sized companies.



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