Market will soon start acting and reacting to economic fundamentals
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We as a country are nearly perpetually in an election mode. However, Lok Sabha elections are the biggest of them all, with maximum emotional investment in and psephological conversations about them by the citizens. And the outcome of these elections has the maximum impact. This time, the conversations around elections were further accentuated as the elections dragged on for a longer duration. Finally, the outcome was not necessarily in line with the market expectations. For the markets there is a sense of déjà vu from 2004 or 1991 - the totally unexpected results and the uncertainty emanating from it have made the markets a bit jittery. The uncertainty is not about who will form the Government, but about the construct of the Government. While it will be a BJP led government with the support of its pre poll partners, the uncertainty is about the Government’s ability to push large reform agendas in its third term. It is usual for the market...