Nifty Tanks 8.5% Amid Election Drama: Here’s How Markets Have Reacted to Past Election Results

Markets Crash 5%: How Nifty Reacted on Previous Election Days

Today, Indian markets took a nosedive, undoing Monday’s gains, as the Lok Sabha election results didn’t match the hopeful exit polls. This surprising turn of events caused panic among investors, leading to a massive selloff that wiped out around ₹26 lakh crore in wealth during intraday trading.

The BSE Sensex dropped by 6,234.35 points (8.1%), hitting a low of 70,234.43. Similarly, the Nifty plunged by 1,982.45 points (8.5%), reaching 21,281.45.


Despite Monday’s big rally—the biggest since January 2021—investors faced a harsh reversal. The main cause for this sharp decline was the disappointing early trends from the Lok Sabha election results, which clashed with the positive exit polls. This mismatch shook investor confidence, causing a major market drop due to the uncertain political outcome.

Here’s a look at how the markets have performed on previous election result days:

  • May 23, 2019: Nifty declined 0.7% to 11,657.05. It hit an intraday high of 12,041.15 and a low of 11,614.5.
    • Context: Despite BJP’s second victory (“Modi 2.0”), markets saw slight declines, possibly due to global economic uncertainties and domestic issues.
  • May 16, 2014: Nifty rose 1.12% to close at 7,203, with an intraday high of 7,563.50 and a low of 7,130.65.
    • Context: BJP’s win with Narendra Modi as PM led to a positive market response, though gains were modest, indicating cautious optimism about policy changes.
  • May 16, 2009: Markets were closed (Saturday). On the following Monday, May 18, 2009, Nifty surged 17.74% to 4,323.15.
    • Context: UPA 2.0’s victory under Dr. Manmohan Singh saw markets soaring, reflecting investor confidence in stable governance.
  • May 13, 2004: Nifty rose 0.37% to 1,717.50.
    • Context: UPA’s rise to power brought a modest market increase, showing cautious optimism amid uncertainty about the new government.
  • October 6, 1999: Nifty jumped 1% to 1,392.70.
    • Context: NDA’s win, led by Atal Bihari Vajpayee, was seen as a vote of confidence in his leadership and economic policies.

These past trends show how election results can greatly impact market behavior. While political outcomes significantly influence investor sentiment, other factors like economic fundamentals, geopolitical events, and global market trends also shape market movements during such crucial times. Investors are advised to stay cautious, informed, and focus on long-term strategies to navigate election-induced volatility and seize opportunities amidst the market turbulence.

Disclaimer: The views and investment tips expressed by investment experts on Sharepriceindia.com are their own and not those of the website or its management. Sharepriceindia.com advises users to check with certified experts before taking any investment decisions.​​

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