"The rally can be described in one sentence as a 100%
Asked if analysts are overplaying the Modi factor? Andrew Holland, CEO, Ambit Investment Advisors, said: "Yes, we probably are."
Now, if we talk about facts, it may well be argued that the recent rally was after all not on the back of the much vaunted Modi wave.
The stock market did not make gains as an immediate impact of the announcement of poll dates by the
In fact, the market was in a bearish mode since when the poll dates were announced; but it was just minutes after the pullout announcement from
Poll dates were announced in the early hours of March 5, and the markets didn't move a bit on that news.
It may be noted that after making record highs on Thursday (March 6), the markets made fresh record highs the next day as well, that is Friday (March 7). This surge can be largely attributed to the current account deficit numbers, reconfirming the belief that the macros for India are improving.
The current account deficit (CAD) for third quarter of the current financial year narrowed to $4.2 billion versus $5.2 billion on a quarter-on-quarter basis.
CAD for the April-December period now stands at $31.1 billion versus $69.8 billion YoY. This translates into the CAD being at 2.3% of
Stopping short of not calling it a Modi rally, Lalit Nambiar of
Explaining the reasons for the rally, he said: "When we look at these new highs, it is essentially an index level and in an economy which is growing at an average of 5% to 7%, you will obviously see earnings also grow and to that extent, index hopefully will continue to hit new highs in the future. So, there is too much being tied into this new high factor."
Markets on March 5, the day poll dates were announced: The 30-stock Sensex ended at 21,265.49, up 55.76 points or 0.26 per cent.
The 50-stock
March 6: Sensex closed at a fresh all-time closing high of 21,502.62.
Nifty ended at all-time closing high of 6,401.15, up 72.50 points or 1.15 per cent.
March 7: Sensex ended at a record closing high of 21,915.14, up 401.27 points or 1.87 per cent.
Nifty closed at record closing high of 6,525.60, up 124.45 points or 1.94 per cent.
Today, the markets are down. Sensex plunged as much as 160 points in intraday trade. At 11:11 am, the Sensex was at 21,613.19; down 161 points, or 0.74%.
The Nifty was at 6,438.15; down 54.95 points, or 0.85%.