Sensex and Nifty 50 closed marginally lower on May 15 after a choppy session wherein both benchmarks swung between gains and losses. The benchmarks fell after having risen for the past three sessions.
At close, the Sensex was down 117 points or 0.2 percent at 72,987 and the Nifty 50 was down 17 points or 0.1 percent at 22,200. About 2,180 shares advanced, 1,471 shares declined, and 135 shares were unchanged.
The broader markets showed resilience with BSE Midcap rising 0.6 percent and BSE Smallcap gaining nearly 1 percent.
The domestic market is likely to remain volatile until the announcement of election results in June. However, analysts believe that the volatility related to elections is temporary, and remain optimistic about India's long-term growth prospects.
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"Voter turnout and its impact on the election outcome is making the market nervous," said Sunil Damania, Chief Investment Officer, MojoPMS. "The market is going with the equation that lower turnout means the BJP may get a lower number of seats as compared to the 2019 election."
"I am fairly confident that any kind of fall in the market should be utilised as a buying opportunity," said Pankaj Karde, President and Head- Institutional Equities, Asit C Mehta Investment Intermediates.
"The market could correct and fall to 21,800 levels regardless of the election outcome. A scenario where the BJP government does not return to power might lead to a more pronounced correction in the Nifty 50," said Karde.
While FIIs are currently aggressively selling Indian equities, it is expected that they will re-enter the market once the election uncertainty subsides. In the meantime, DIIs are capitalising on the dip, snapping up shares sold by FIIs.
Investors are also awaiting crucial CPI inflation data from the US later in the day, which will provide further cues to the investors regarding the Federal Reserve's next move on interest rates. Investors should keep an eye on general election updates, corporate earnings and their outlooks, and global developments.
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