Yesterday the market was up by over 3% because of the strong exit polls prediction. But today when the actual results came in, the market has gone down drastically. This is because everyone thought BJP will comfortably and get the clear majority. But today when the election results are out, none of the individual parties have got the clear majority.
Though BJP became the single largest party but still 32 seats less than the majority mark. Since the BJP got into the pre poll alliance, the alliance won around 290+ that means the government will be formed by the BJP. The problem is since its a coalition government, the steps taken by the government might not be so great like the precious two terms.
PC: Google.com
The stock market which risen yesterday anticipating that the BJP will get a great majority has fallen today when it didn't happen. The market has fallen by over 5.5% today removing all the gains which it gained yesterday. At one time the sensex fell by more than 8% but recovered a bit. So yeah events like this can really change the market.
People who would have sold yesterday are on profit whereas people who are actually holding it got a good loss in some of the shares which has hit the lower circuit. I feel the market will go down more because still there is a drama to unfold whether the government will be formed or not. So until the government of NDA is formed which will be in 2 to 3 days, the market might go down further.
So if you have the money, it's time to invest in market in small quantities because you never know once the government is formed and start doing the work the market can rebound.
