Markets and elections: Bulls banking on stability

A review of the stock market’s performance on the next day of exit poll outcome during the last four general elections shows that this trend is not new.

In 2004, the Sensex and Nifty plunged 4 per cent despite five exit polls predicting 257 seats for the NDA and 185 seats for UPA

2019 Exit Polls:

In the 2019 general elections, which were held between April 10 and May 17, 13 exit polls predicted 306 seats for the NDA and 120 for the UPA, on an average basis. The Sensex and the Nifty rose over 3 per cent each a day after (May 20) the outcome of the exit polls. The surge was on account of an expectation that the BJP-led government will continue.

2014 Exit Polls:

The 2014 Lok Sabha elections were conducted from April 4 to May 12. On an average basis, 8 exit polls estimated 283 seats for the NDA and 105 for the UPA. A day after the forecasts were announced, both the benchmark indices rose 1.35 per cent.

2009 Exit Polls:

In 2009, four polling agencies predicted 195 seats for the UPA and 185 seats for the NDA, an average. The Sensex fell 1.22 per cent and the Nifty declined 1.14 per cent on the next day of exit poll projections.

2004 Exit Polls:

In 2004, exit polls predicted 257 seats for the NDA and 185 seats for the UPA. The Sensex declined 4 per cent and the 50-share Nifty fell 3.93 per cent on the next day of the exit poll forecasts.