Markets witness 11% surge in one-month post June elections

The Indian markets have indeed experienced a significant surge, rising by 11% in one month following the June elections. This uptick can be attributed to several factors, including political stability, investor confidence, and positive economic indicators. The election results likely played a key role in boosting market sentiment, as investors anticipate favourable policies and reforms from the newly elected government.

According to the sources, the surge marks the strongest since May 2019 and May 2014. Notably, Sensex surged maximum points in just 139 trading sessions, marking the fastest ever 10,000 point club, according to MoneyControl. One month after the elections, in May 2019, the markets had a minor decline of 0.1 percent, whereas in May 2014, they experienced a 5.8 percent increase. The biggest increase was recorded in May 2009, when markets shot up over 22% a month following the election results.

On July 4, India's benchmark Sensex broke through the 80,000 barrier for the first time, marking a new record high. The Nifty also closed above barrier to record a new lifetime high. After the election, one month later, the BSE midcap and smallcap indices both saw notable gains of 15.4 percent and 19.6 percent, respectively.

Meanwhile, it is important to note that the Sensex surged from 70,000 to 80,000 in just 139 trading sessions, marking its fastest-ever 10,000-point climb. The last time it surpassed was on December 11, 2023, to 70,000. Interestingly, it took somewhat more than five years for the Sensex to double the digits from 40,000 to 80,000 as compared to when it took almost 14 years to reach 40,000 from 10,000 initially.

Now, the investors will keep a close eye on the market as July will see announcements on the Union Budget, progress of Monsoon and Q1FY25 earnings. As July has shown a positive trend in almost 80% of instances in the past, the trends are likely to remain consistent.