Mumbai, India (BBN) – The benchmark BSE Sensex was trading down by over 100 points as caution prevailed ahead of state elections results, including that of Uttar Pradesh, and a US Federal Reserve policy meeting next week.
Uttar Pradesh election is the world’s largest this year and will have a key influence on Prime Minister Narendra Modi’s chances of clinching a second term in 2019, reports The Hindu Business Line.
Exit polls will be released on Thursday and results will be out on Saturday.
Meanwhile, the Federal Reserve has a policy meeting on March 14-15 and markets are expecting a rate hike after recent hawkish comments by policymakers.
At 3:23pm, the 30-share BSE index Sensex was down 100.35 points or 0.35 per cent at 28,899.21 and the 50-share NSE index Nifty was down 22.95 points or 0.26 per cent at 8,923.95.
Among BSE sectoral indices, metal index fell the most by 1.94 per cent, followed by realty 1.53 per cent, oil & gas 1.41 per cent and infrastructure 0.98 per cent.
On the other hand, banking index was up 0.29 per cent, healthcare 0.19 per cent and consumer durables 0.15 per cent.
Major Sensex losers were Tata Steel (-1.95 per cent), ONGC (-1.66 per cent), Reliance (-1.37 per cent), M&M (-1.28 per cent) and Infosys (-1.18 per cent), while the major gainers were State Bank of India (-0.63 per cent), Power Grid (-0.62 per cent), HDFC Bank (-0.48 per cent), TCS (-0.46 per cent) and ITC (-0.15 per cent).
“The market is in a consolidation phase and is probably already over-rated.
Election results followed by the Fed meeting are important for the Indian market, after which it will take a call accordingly next week,” said RK Gupta, managing director at Taurus Asset Management Company.
“Whatever may be the outcome of the elections, the market is going to take a correction.”
Talks of a hung house suddenly gained momentum in the last phase of polling with Prime Minister
Narendra Modi himself flagging the possibility of a hung Assembly in the State.
Even before the election results are declared on March 11, party insiders do not discount chances of a fractured verdict after the seven phases of polling that will come to an end today in the absence of any wave.
Modi said SP and BSP were waiting for such an opportunity for bargaining, prompting Chief Minister Akhilesh Yadav to comment that after dreaming of 300 plus seats, Modi was now talking about a fractured verdict.
The contest is between the BJP, the ruling Samajwadi Party along with partner Congress and Mayawati’s Bahujan Samaj Party, which is looking to script a comeback in the State.
To win 202 or 50 per cent seats this year, a party will need to get 35 per cent of the vote share.