Reaction to state elections results to be asymmetric: JPMorgan

Bharat Iyer of JPMorgan says equity markets are going into these elections results expecting the BJP to do well.

Consequently he expects the market's reaction to the results to be asymmetric. A win for the BJP should result in a positive reaction but a weak showing will likely result in a more adverse reaction, Iyer feels.

It may be a coincidence, but it is important to note that state election results have had a meaningful bearing on the reform agenda over the past, Iyer says.

He further says one interpretation for this trend could be that a positive verdict emboldens the ruling party to pursue the agenda with more confidence and vigour and it fragments the opposition.