According to an ET report, analysts have looked at historical data from the last four decades to gain insights during election years. He estimates that the benchmark index will return about 17% in 2024. This year alone, Nifty has already given a return of 18%. % Rally.
Looking back, according to ICICI Securities, equity returns during general election years have been positive in nine out of 11 cases, with an average return of 17%. For example, in 2019, Nifty rose by about 14.3%, while in 2014, it rose by 30%. The significant increase of 81% in 2009 was a rebound from the sharp decline of 52% in 2008, which began globally. Economic Crisis. In 1998 and 2004, Nifty gained 63% and 13% respectively.
Market performance during election years
Analysts say Indian equity markets exhibit distinctive characteristics during election years. Dharmesh Shah, head of technical at ICICI Securities, was quoted as saying that calendar year 2024, being a central election year, will have a significant impact on sentiments in the equity markets. Shah said it has been observed that benchmark indices have performed well despite volatility in election years, and hence, one should use volatility during election years. As a buying opportunity.
If we look at the last four election years since 2004, indian equity Nifty has given consistent positive returns with a minimum gain of 11% and an average of 22%.
The banking, financial services and insurance sectors, important market players, delivered double-digit returns in three of the four election years. Additionally, sectors like auto, power, construction and infrastructure have flourished significantly in at least three election cycles. Defensive sectors like consumption, pharma and IT have shown consistently stable performance in the last four election years.
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