Positive signs

Bulls can stretch valuations

The bullish market reaction after the Assembly election results can be attributed to a “policy continuity” premium. Most political commentators are assuming the Bharatiya Janata Party will do well in the 2024 Lok Sabha elections and, thus, the policy focus will remain the same. However, it is not only the political factor that is driving sentiment. Market action in November, before the Assembly election results were announced, was strongly positive. Every industry index registered gains in November, with real estate leading the pack. Sectors such as automobile and health care registered month-on-month gains of over 10 per cent. The Nifty50