Monday, August 31, 2015
If Narendra Modi comes to power, Sensex may surge to 30,000 points by Diwali
Now, if Narendra Modi takes the coveted Prime Minister’s seat in Delhi, one thing is for sure: The Sensex and other stock market indices would see an unprecedented surge, setting the stage for a big revival of the stock market, so much so that the Sensex could touch the 30,000-points mark by this Diwali.
We are seeing a Modi wave that is likely to hit Delhi but how big this wave is is a big question. While some argue that Modi and his NDA team may miss the absolute majority mark and not form the government, many optimists feel that the NDA plus allies could touch the 300-seat mark in the Lok Sabha elections.
In case the former happens, the Sensex is going to dip to may be below 16,000 points and if the latter takes place, the benchmark index could inch closer to the 25,000-points mark (at least for now).
And marketmen seem to believe in the former: That the Modi wave is a giant one, and as a result, we have seen the Sensex soar past the 22,000-points mark and reach a new high almost every other day. The latest closing figure of the Sensex is 22,446 points, a surge of 60 points from the previous day’s close.
Till the elections are over, the large caps would be more or less stable over the looming uncertainty and the main players would be the unpredictable small and mid cap stocks.
On Tuesday though, the Nifty opened on a positive note and surged to an all-time high on the backdrop of profits in technology, oil and gas along with auto sectors.
This is a good indication as these sectors form the core of India’s industry, and if they continue to perform, the stock markets and India’s GDP growth (which reflect the mood of the economy) are set for a long-term growth.
If Modi comes to power, it could even be possible that the Sensex could surge to an unthinkable high of over 40,000 (yes 40,000) points in may be three years’ time.
We are not sure about others, but marketmen firmly believe that Modi would come to power anyhow and give a fillip to the markets, taking the Sensex up to 30,000 points probably by Diwali.
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