Investor wealth surges as Modi’s ratings go up

Investor wealth surges as Modi’s ratings go up

Investors became richer by 7.5% in past one month after the Pulwama attack with Indian markets sensing a possibility of Prime Minister Narendra Modi returning to power in the 2019 general elections.

The total wealth of the Indian investors in the Bombay Stock Exchange (BSE) has increased by a whopping Rs 10.35 lakh crore since February 15, a day after an explosive-laden vehicle driven by a Jaish-e-Mohammed affiliated terrorist rammed in the Central Reserve Police Force (CRPF) convoy, killing more than 40 jawans.

The ruling Bharatiya Janata Party (BJP) is being seen as more business-friendly than the opposition Congress, which has led to the rally in the Indian markets, according to analysts.

After the attack, as tensions between India and Pakistan escalated to the highest level since the 1999 Kargil skirmish, Modi, who would be seeking re-election in April, saw his approval rating go up.

“Markets have made up their mind that Modi is going to be re-elected again. So, you are seeing this rally. It is all about sentiments,” said a senior analyst with Motilal Oswal.

The overall market capitalisation of all the companies listed on BSE has risen from Rs 1,37,64,119.09 crore on February 15 to Rs 1,48,20,060.39 crore as on date.

The positive sentiment of the market is well reflected by the change in the indices as well. BSE’s 30-share benchmark Sensex has jumped by 5.4% in the given period, making gains worth 1,943.22 points. As on date, there are 4,13,57,794 registered investors on BSE, trading in the spectrum of 4,686 companies.

Similarly, the broader 50-share index of the NSE — Nifty — has seen its index value jump by 5.8% during the same period, gaining 617 points.

Of the 18 trading sessions in the markets since February 15, the markets have seen a decline for only five trading sessions, with the rest being gains.

The gains in the mid-cap indices have been significantly higher than the blue-chip indices, with BSE Midcap gaining 8.5% during the 18 trading sessions.

However, the surge in markets has happened on the back of tremendous inflow by foreign investors, at a time when domestic institutional investors are pulling out of Indian markets. FIIs, who usually seek stability in the government and strong macro indicators, have parked in a net of Rs 24,826.73 crore in Indian markets since February 15.

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