Nifty to Exceed 23,000: Lok Sabha Elections 2024 Trading Strategy

Hey, Have you voted in the Lok Sabha 2024 Elections?

Lok Sabha 2024 Election results are soon to be announced. Everyone is eagerly waiting for the same. All 7 voting phases are completed now. Just the outcome awaited.

As India gears up for the 2024 Lok Sabha elections, market analysts are optimistic about the Nifty index’s performance, forecasting it to rise above the 23,000 mark.

People are optimistic about the third-term victory of the Bhartiya Janta party (BJP), leaving the other parties far behind, as most of the exit poll results out on 1st June 2024 say.

Nifty 50 prediction is grounded in the expectation of positive economic policies and investor sentiment around the elections.

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Stock Market Current Situation

Stocks in the Indian stock market fell sharply on Thursday, May 30, as May futures and options (F&Os) expired. As the Lok Sabha election results for 2024 approached, market participants remained jittery.

It was the fifth consecutive session in which both the Sensex and the Nifty 50 dropped by about two per cent, which resulted in investors losing nearly ₹10 lakh crore. As for the Nifty 50, it closed the day at 22,488.65, down 216 points, or 0.95 per cent, at 22,488.50. The Sensex ended with a loss of 617 points, or 0.83 per cent.

After closing at a lifetime high on May 23, the 30-share BSE index has been on a downward trend. During the five sessions leading up to Thursday, there has been a loss of 479 points on the NSE index. A further 1.21 per cent decline in BSE Midcap and 1.33 per cent decline in BSE Smallcap indices today indicated further losses in both segments.

There’s still a great deal of uncertainty about the election outcome in the last few days, causing election-related nervousness to persist. Global interest rates are expected to remain high for longer, contributing to a drop in Asian stocks, tracking the overnight decline on Wall Street.

Head of Retail Research, HDFC Securities, Deepak Jasani said, “Investors are trimming their positions ahead of the election outcome as a precaution. Also, the weakness in global markets is weighing.”

Aishvarya Dadheech, Founder and Chief Investment Officer of Fident Asset Management said, “The market is completely discounting the fact that the current government will stay”. 

It will, however, be “completely catastrophic” for the market if the government does not win the majority.

What Should Be Your Trading Strategy for 4th June 2024?

On June 4, traders should consider the following strategies to capitalize on the expected market movement:

  1. Buy on Dips: Analysts suggest buying on market dips, expecting a bullish trend as election results approach.
  2. Focus on Blue-Chip Stocks: Investing in stable, large-cap companies is recommended due to their resilience and growth potential during election periods.
  3. Monitor Sector Performance: Pay attention to sectors likely to benefit from election promises and policy changes, such as infrastructure and banking.

There are some names to watch out for during the session on election results, such as Reliance Industries Ltd (RIL), Larsen & Toubro (L&T), Adani Group stocks, as well as PSU stocks like Bharat Electronics Ltd (BEL), REC, and PFC.

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Market Sentiment: Lok Sabha Elections 2024

The election period often brings heightened market activity, with investor sentiment playing a crucial role. Historical data indicates that markets tend to perform well when there’s anticipation of a stable and business-friendly government.

By following these strategies and keeping an eye on market trends, investors can potentially maximize their returns during this Lok Sabha Elections 2024 season.

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