Some people are happy with the election verdict in India, while others are grumpy. Regardless of where you stand, India remains a strong investment opportunity. Political leadership does matter and can influence the market, but it is rarely the only factor driving economic performance.
Before the elections, Morgan Stanley predicted that India's stock market was on the verge of its longest bull run. The market anticipated the re-election of the incumbent party, expecting it to provide the continuity and stability needed for sustained growth. This expectation was already reflected in current share prices, but the somewhat surprising outcome of the election impacted the market's trajectory with many premier stocks tumbling.
The market is likely to bounce back but those making predictions about India will be well advised to temper their confidence. It is far more complex than most people expect.