Expectations have been high of the Assembly election result moving the markets. Some say the movement will be purely sentimental and momentary, while some expect a significant correction post the elections. Consensus, however, agrees that the actual impact of the election result lies in how much and how fast the new government will be able to deliver on pending decisions such as oil deregulation.
PN Vijay, Portfolio Manager, www.askpnvijay.com opines on CNBC-TV18, his outlook of the market and the effect of the election results on the bourses. He sees the election result being a positive for the Congress and says that, for the markets, elections are only an event and not a trend. But buoyed by a recovery in global markets, today is bound to be a good trading day, he says. Below is a verbatim transcript. Also watch the accompanying video. Q: What are you assessing in terms of a move that the market will see today? A: There are four states, which have gone to the election. In that, Assam and Kerala not have much of an impact. The biggest impact one would expect from the results in West Bengal because West Bengal, as we know in the last 44 years, has been under communist rule. The state which used to be number one in India more than 100 years in industrial and commercial developments in form of almost all the multinationals and Indian groups, has deteriorated. So in West Bengal, there is a big change when Trinamool and Congress combined comes into power. That would have a very big sentimental effect and also probably, strengthen the hands of Dr Manmohan Singh to put through reforms because even within the Congress, Dr Singh has a lot of opposition from the Leftist elements. So the irrelevance or marginalization of Left would have a profound influence on policy decisions at the Center. Tamil Nadu is another kettle of fish. In a very funny way, if the DMK-Congress combine loses, it may not be too bad for Dr Manmohan Singh because DMK is becoming quite an embarrassment for him over 2G. So he doesnDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
