Lok Sabha Elections 2024: What if Narendra Modi doesn't become PM, what if BJP allies join INDIA bloc? UBS gives 3 scenarios

Lok Sabha Election Results 2024: Global brokerages and market sentiment were on Cloud Nine after Lok Sabha Elections 2024 exit polls. The brokerage predicted positive things for the economy and the BSE Sensex and Nifty 50 scaled new heights. But election trends didn't turn out to be in favour of the BJP as exit poll shows. The party may not get a full majority on its own. In such a situation, it has to depend on its allies to form a government. Global brokerage UBS says that a coalition  government may not be good for the market. UBS has also maintained an 'underweight' stance on India.

According to UBS, in the current conditions of Lok Sabha election trends, three situations can arise.

- The government may not run smoothly if PM Modi has alliance leaders in the ministry.

- The NDA forms the government and Modi is not the PM but someone else is.

- BJP allies part ways from the saffron party and join the INDIA alliance. In such a case, there will be major policy changes.

What will be the impact?

UBS says, out of the three, only the first situation is positive for the market. The pace of reforms will remain intact in the first scenario. Market valuations are expensive.

Earlier, in the day, the share market suffered the biggest intraday loss after May 2020 it crashed poorly. 

Investors lost nearly Rs 30 lakh crore in a single session on Tuesday.

As the counting for the Lok Sabha polls entered the final phase, BSE Sensex closed 4,389 points down, or 5.74 per cent, at 72,079, while Nifty shed 1,379 points, or 5.93 per cent, to close at 21,884 on Tuesday.

Nifty Bank suffered a loss of over 4,051 points, or 7.95 per cent, to close at 46,928.