On Tuesday, Indian ADRs (American Depository Receipts) took a significant hit. ICICI Bank, HDFC Bank, and Reliance Industries Ltd (RIL) saw their prices fall by almost 11%, 9%, and 8%, respectively, around 7:30 PM.
This decline mirrors the turmoil in Indian markets where the S&P BSE Sensex and Nifty 50 indices ended with sharp losses. The Sensex closed at 72,079.05, down 4,390 points or 6%, while the Nifty dropped 1,379.40 points or 6% to finish at 21,884.50.
PM Modi’s Gratitude
Prime Minister Narendra Modi tweeted his gratitude, thanking people for their support as the NDA secured a third consecutive victory. “People have placed their faith in NDA, for a third consecutive time! This is a historical feat in India’s history. I bow to the Janata Janardan for this affection and assure them that we will continue the good work done in the last decade to keep fulfilling the aspirations of people. I also salute all our Karyakartas for their hard work. Words will never do justice to their exceptional efforts,” Modi tweeted.
Investor Advice
Other Indian ADRs like Wipro, MakeMyTrip, Yatra Online, and Dr. Reddy’s Laboratories also experienced declines, falling up to 3%. ADRs are shares of Indian companies listed on the New York Stock Exchange. Pradeep Gupta, Co-founder & Vice-chairman at Anand Rathi Group, commented that the market volatility was driven by the uncertainty of the election results, especially given the discrepancy between exit polls and the actual outcomes.
“The pre-election rally witnessed yesterday, driven by expectations of a BJP victory, had already been factored into market prices. Till the question of the continuity of the current government was at an unsure position, the markets continued with heightened volatility in the short-term period,” Gupta said.
The Fear Index, India VIX, peaked at 31.71 before ending the day at 26.75, marking a more than 50% intraday jump, the highest single-day increase in nine years.
Gupta emphasized that despite initial volatility, markets usually recover and can even prosper in the long term. He advised investors to focus on long-term strategies, maintain diversified portfolios, and avoid panic selling. Strong fundamentals and resilience against political changes are essential for navigating market volatility, he added.
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