As the sixth phase of polling in the Lok Sabha Election 2024 concludes, analysts are busy predicting the outcome set to be announced on June 4, 2024. Stock market experts are also keenly watching, identifying segments that might outperform in the short, medium, or long term. According to these experts, the Indian stock market is expected to be highly volatile from June 1 to June 4, 2024. Investors should prioritize protecting their capital during this period of high volatility. Currently, India’s VIX (Volatility Index) is between 19 and 23, but it may rise further. Pre-poll surveys suggest a likely BJP-led NDA government in New Delhi, making the exit poll results on June 1, 2024, crucial. Experts recommend focusing on manufacturing, banking, and power and energy sectors, which might do well in the post-election rally. They advise avoiding speculative “monkey and donkey” stocks and instead choosing quality stocks with strong quarterly results and low or no debt.
Trading Strategy for Election Results Day
Sandeep Pandey, Founder of Basav Capital, shared his strategy: “We expect a new bull trend after the Lok Sabha Election 2024 results. Traders and investors should focus on quality stocks, especially those that are debt-free or have low debt. It’s important to look for companies with consistently positive quarterly results,” he said, emphasizing to avoid speculative stocks that may rise temporarily in a bull market.
“The primary rule for trading around the election outcome is to safeguard your capital. You can only make money if you have capital in hand,” Sandeep Pandey added.
Avinash Gorakshkar, Head of Research at Profitmart Securities, echoed Pandey’s views. “Most pre-poll surveys predict a BJP-led NDA government post-elections. Investors should focus on sectors that are priorities for the Modi-led NDA government, as policies are likely to continue if the results match the surveys.”
Segments to Watch
Sandeep Pandey of Basav Capital highlighted some key sectors for value picks. “The manufacturing sector has seen continuous capital expenditure growth under the current government. This is a good segment to watch. Additionally, the Reserve Bank of India’s recent credit infusion will provide extra liquidity to Indian banks to meet the rising demand in manufacturing post-elections. The power and energy sector is another area to consider in light of the election results,” he said.
In summary, investors should focus on quality stocks in manufacturing, banking, and energy sectors, avoid speculative stocks, and prioritize capital protection during the volatile period surrounding the election results.
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