Maharashtra Elections 2024 was one of the crucial factors for the markets. Maharashtra is not only a major industrial hub, it also accounts for almost 13-14% of the country’s GDP. It attracts over 30% of FDOs and the political future of the state is a topic that India Inc and the stock markets are closely watching. Markets have corrected by almost 10% from recent highs and most experts believe that a clear blow from the opposition could significantly prolong the correction phase.

Maharashtra Elections 2024: Not an important factor at the moment

A close look at trading over the past few days indicates that investors have been in a wait-and-watch mode and there has also been some profit-taking.

Market veteran, Nilesh Shah, Managing Director – Kotak Mahindra Asset Management explained that there might not be a major impact if it is a close competition.

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“No material impact is expected in the event of a close competition. If the opposition wipes the slate clean, yes, the markets will correct a little more.”

According to Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services, “Markets are likely to consolidate for some time to come. Third quarter results and budget expectations will be the next big triggers. The state election the result is a small factor. This is not a decisive choice for the market. Real estate and other sectors governed by state policies may see some sentiment backlash, but no long-term impact. Key economic policies are mostly decided by the Centre. In the current market environment, the main concern concerns the geopolitical situation in the coming days as well as crude prices. Inflation is a major concern in our country. Possibilities of the Chinese economy remaining under pressure could reverse the trend of FII flow. A rate cut is unlikely before February – that’s another crucial trigger.”

Maharashtra Elections 2024: Key Nifty and Sensex levels to watch

Market sentiment is currently negative and analysts expect a short-term impact if the Maharashtar election results do not match expectations.

Vinod Nair, head of research, Geojit Financial Services pointed out that “”profits were also recorded ahead of the upcoming Maharashtra state elections. The recent correction in valuations suggests a potential pause in further price erosion. However, the recovery will depend on an uptick in profits, which are expected to rebound due to the likely surge in central and state spending in the second half.

In terms of Nifty levels, analysts believe that 23,000 is an important bottom for the Nifty and the break below could prolong the correction phase. Akshay Chinchalkar, Head of Research at Axis Securities, highlighted that “23,350 will be a key low that the bulls will need to protect. Immediate resistance will be the area of ​​previous lows between 23,820 and 24,000. Crossing the 200 moving average two days ago did not result in any further selling. Any subsequent breakout of 23,350 with a position of 24,130 will mean 23,200 comes into play. So, in summary, it is biased towards a short-term stretch progression in the 23,350 – 24,130 window.”