Will markets extrapolate state poll outcomes to general elections in 2024?

Meanwhile, last week, the S&P BSE Sensex gained 2.29 percent or 1,511 points to end at 67,481 levels, while the Nifty50 gained 473 points, or 2.39 per cent, to 20,267 levels

Markets are likely to see a short-term boost post the state election outcome that is likely to see Narendra Modi-led Bharatiya Janata Party (BJP) in Madhya Pradesh (MP), Rajasthan and Chhattisgarh emerge on top, said analysts. However, post this knee-jerk reaction, the focus, they believe, will shift to other factors such as geopolitics, oil prices and central bank policy action.

“There is a lot of time between now and the general elections in 2024. The markets may see a short-term boost now, but will soon start focusing on fundamentals. Flows into equity markets – both foreign and domestic