Rama Krishna Sangem
Here is an assurance from PM Modi that he will come back to power for a third term. He was confident that the stock markets which have been seeing some volatility this months will bounce back on and after June 4.
Narendra Modi, in an interview to India Today & Aj Tak news channels aired on May 19, Sunday, said the stock market would have a strong run once the election results are out.
“You see, the day election results come out, and throughout that week, those who punch trades will get tired,” Modi said, responding to a question about whether the markets were displaying nervousness regarding the election outcome after pricing in the return of the incumbent government with a brute majority.
“Our government has implemented maximum economic reforms and pro-entrepreneurship policies to strengthen the economy. We started at 25,000, and now the Sensex has reached 75,000 points. The more common people invest in stock markets, the better for the economy. And the risk appetite of every citizen should rise,” said Modi. He said the shares of public-sector undertakings were also rallying these days.
Indian equities have been turbulent since the elections began on April 19, amid concerns that the ruling National Democratic Alliance (NDA) would not get the required numbers to carry out the far-reaching reforms the markets were expecting. India Vix, a gauge of market volatility, has gained 47 per cent since the beginning of the elections.
Buoyant on latest forecasts
Modi’s assertion that equity markets are rallying follows assurances by three senior Cabinet ministers regarding the stability of the markets. Analysts termed the PM’s statement another reassurance of regime continuity and said markets won’t move much unless some market-moving initiative is announced. BJP is buoyant on latest forecasts like that of Prashant Kishor that Modi will come back to power for a third term
This is not so much of a comment on the market. This is more of a comment on the ruling party’s confidence on coming back with a strong majority. Markets don’t take any political statement too seriously unless it translates into something specific in terms of policy implementation or allocation to a particular sector,” said U R Bhat, co-founder of Alphaniti Fintech.
Earlier last week, addressing a rally, Modi lauded the growth of equity markets in the previous 10 years.
“Mumbai is India’s economic powerhouse. See where the equity market was 10 years ago and where it is now. Lakhs of small investors today are connected to the stock markets. We are the fourth-largest stock market, and the trust of global investors is rising. The Opposition alliance wants to break this faith,’ said Modi.
This is Modi’s answer to some foreign financial firms like Bernstein which predicted a collapse of stock markets on June 4 after the Lok Sabha election rersults.
