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India Front Line Report
SEAnews Issue:monthly
2014-04-25 ArtNo.44959
◆Global financial biggies catch India poll fever
【New Delhi / Mumbai】Showing a strong global interest in India's general elections, over a dozen global financial giants, including Goldman Sachs, HSBC and Citigroup, are keeping a close tab on these polls and are analysing the likely economic impact of different possible outcomes.
Large foreign and domestic brokers have differing views on the latest run in the markets that has taken key benchmark indices to all-time highs. While some argue there is more upside left, others suggest valuations might have run up far ahead of fundamentals.
Vishal Kshatriya of Edelweiss Financial says in his column; The Nifty continued its relentless northbound journey and made fresh new life-time highs. We would like to reiterate that we have seen broad-based participation in the current upmove with good cash volumes, which is a good sign for markets. The India Volatility Index (VIX) after generating a breakout recently has continued its uptrend. We have been mentioning in our previous articles that as we head towards May, we will see a breakout in VIX. We "vote for volatility" as we head towards Lok Sabha elections.We expect India VIX to test 40-45 per cent by next month.
 However a Standard Chartered report says; The rally in Dalal Street may continue if a stable government is formed at the Centre, but major gains are unlikely as markets have already factored in poll outcome partly as visible from recent rise in indices,
 The Hindu BusinessLine reported on April 10 as follows; Sensex closed flat with a gain of 13 points at 22,715 after hitting a new high in the morning session. The benchmark Sensex opened on the positive note at 22,729 against the previous close of 22,702. The index made a high of 22,792 and low of 22,644 before closing at 22,715. Sensex gave out much of the gains recorded in the morning session as investors preferred to book profit after the recent rally in the market.
○NDA has 28 parties, but most are marginal players
【New Delhi】The Bharatiya Janata Party (BJP) claims the National Democratic Alliance (NDA) now has 28 parties under its fold. However, the boast conceals how a majority of the parties that have joined the alliance are electorally insignificant. Only six of the 28 parties had any presence in the outgoing Lok Sabha.
BJP leaders tried to tell the world that the NDA under its prime ministerial candidate Narendra Modi was no more “untouchable” and was expanding and attracting new allies from across India. However, the NDA isn’t as healthy as they would like us to believe. Here is an analysis of how most of the 28 parties are either nascent or enjoy limited support base or are not contesting the Lok Sabha polls.
【News source】

Global financial biggies catch India poll fever

Brokerages divided on pre-election rally

We 'vote for volatility' in the run up to Lok Sabha elections: Vishal Kshatriya of Edelweiss Financial

Major market rally unlikely as poll outcome already priced in

Sensex closes flat on profit booking

NDA has 28 parties, but most are marginal players

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