Election Results: The Indian stock market faced its steepest plunge since March 2020, triggered by vote counting in the Lok Sabha elections, suggesting that the ruling BJP might fall short of a simple majority. Market analysts and leading firms attributed the dramatic swing to the unexpected election results.
On election result day, Indian equities opened weak and experienced panic selling throughout the morning. Despite a brief recovery mid-session, another wave of selling in the final session led to a significant drop, with the Index plummeting 1,379.40 points to close at 21,884.50.
The sell-off was widespread, affecting nearly all sectors except for Fast-Moving Consumer Goods (FMCG). Public Sector Unit (PSU) Banks and Energy stocks were the major underperformers.
The broader market, including Mid and Smallcap stocks, was hit even harder, correcting over 7.8%. The Bombay Stock Exchange (BSE) saw over 700 companies hitting their lower circuits, highlighting the extent of the market’s pessimism. Paytm was among the notable companies affected.
