The effect of the assembly election results will be visible, how will be the stock market on Monday? Know what experts say

New Delhi: According to the analyst, global factors and activities of foreign institutional investors (FIIs) will decide the trend of domestic equity markets for this week. However, the results of Maharashtra and Jharkhand elections may have an emotional impact on the stock market on Monday. After a long time, improvement was seen in the stock market on Friday. Where Nifty and Sensex achieved the best one-day gain in five months. After which investors got a lot of relief.

Santosh Meena, Research Head, Swastika Investmart Limited, said that the results of Maharashtra and Jharkhand elections will have a significant impact on the domestic stock market on Monday. Especially Maharashtra where NDA has won unilaterally, which is likely to further boost the bullish sentiment in the market. However, global factors are creating significant risks. Rising crude oil prices as well as rising tensions between Russia and Ukraine have heightened inflation concerns.

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Effect of strong dollar on rupee

A stronger US dollar index and higher US bond yields are weighing on the rupee, leading to record foreign institutional investor (FII) outflows. Maharashtra and Jharkhand assembly election results on Saturday saw the BJP winning a record number of seats in a landslide victory for the party-led ruling Mahayuti alliance, while the India Bloc returned to power on the back of JMM's stellar performance in Jharkhand.

Some other factors including Brent crude and rupee-dollar trend will also influence the stock market trading session. At the same time, US economic data including Gross Domestic Product (GDP) growth rate and international events like the minutes of the Federal Open Market Committee (FOMC) meeting can also influence the market.

Effect of political stability will be visible

Palka Arora Chopra, Director, Master Capital Services Ltd. said the overall political outcome, particularly that of Maharashtra, suggests a positive outlook for the Indian stock market, especially in sectors that benefit from infrastructure development and political stability. . While the selling continues, the volume of net out flows has reduced significantly compared to October. At the same time, foreign portfolio investors (FPIs) had withdrawn Rs 94,017 crore (US$ 11.2 billion) on a net basis.

American elections are also a big factor

Himanshu Srivastava, Associate Director – Manager Research, Morningstar Investment Research India, said the inflow of foreign investors into Indian stock markets was driven by the policies implemented under Donald Trump's presidency, the current inflation and interest rate dynamics, the trajectory of the geopolitical landscape and Will depend on the third quarter earnings performance of Indian companies.

Last week, the BSE benchmark jumped 1,536.8 points or 1.98 per cent and the Nifty gained 374.55 points or 1.59 per cent. Barring energy, most sectors contributed to the rebound, with realty, auto and FMCG leading the way.