New Delhi: The BSE Sensex and the NSE Nifty witnessed major volatility in the week of June 3, 2024 owing to the expectations and outcomes related to the 2024 Lok Sabha elections. Aman Agarwal, Professor of Finance and Dean of the Indian Institute of Finance said that Indian indices were not susceptible to political movements, since they only hold 10 per cent of the entire country’s wealth — 10 per cent compared to 70-80 per cent of the domestic wealth by the US’ Nasdaq, Japan’s Nikkei, Hong Kong’s Hang Seng Index, and London’s LSE among other western markets.
Indian governments in the past have judiciously worked to bringing out policy frameworks and safeguard investors’ interests. Governments are invested in ensuring investors’ safety and security, and boosting markets, he added. These efforts have borne fruit with foreign portfolio investments surging from an average of $15-16 billion to $35 billion even during the COVID-19 pandemic. Now, foreign inflows are roughly worth $65 billion, he said.
“Indian domestic investment in the stock market has gone tremendously high in the last 3-4 years, despite the COVID-19 effect, churns in the global economy as well as in India,” said Professor Aggarwal. According to him, Indian indices are not influenced by political decisions, which shows a level of maturity among Indian investors.
To be sure, foreign investors’ decisions may be affected by information asymmetry. However, small investors don’t change investments owing to govt movements, said Agarwal. “Markets are quite independent… the Indian real economy does not have play related to stock market movements,” he added. That said, the stock market shows some reflection or influences of the people, Agarwal said.
How Sensex and Nifty performed this week
June 3,2024
The Sensex was up 3.75 per cent to 76,738.89 points while the Nifty closed at 23,263 to its all-time high led by tailwinds from exit polls predicting a 3rd straight term for the Narendra Modi government. Investors wealth surged by 12.48 lakh crore.
June 4, 2024
The Sensex and Nifty plunged by nearly 6 per cent on 2024 Lok Sabha election result day, wiping off Rs 30 lakh crore of investor’s wealth as the BJP-led NDA secured lesser seats than predicted by exit polls, while the Opposition INDIA bloc performed better than expected.
June 5, 2024
The Sensex and Nifty recovered 3 per cent on June 5, 2024, after Tuesday’s bloodbath. The Sensex crossed the 74,000-mark while the Nifty recovered to 21,000 levels.
June 6, 2024
Markets stabilised further on Thursday, with the Sensex and Nifty rising by 1 per cent. The Sensex was back above 75,00 levels while the Nifty came closer to 23,000-levels closing at 22,821.40 points. Stock markets were buoyed by the prospect of the BJP-led NDA returning to power for a third straight term.
June 7, 2024
Indian indices closed 2.16 per cent higher at 76,693.26 while the Nifty was up 2.05 per cent at 23,290.15, ending the day at all-time new highs. Stock markets were buoyed by the RBI’s decision to keep the repo rate unchanged and a 72 per cent GDP growth forecast for FY25.
Stock Market Today: The Sensex and Nifty soared to new highs before plunging to record lows, only to touch new highs in the week of June 3, 2024 which was big on political developments. Markets Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
