The BJP has swept Rajasthan and Madhya Pradesh and managed to hold on to Chhattisgarh, while in Delhi they have emerged as the single largest party with the Congress being relegated to the 3rd position. The markets which were rooting for the BJP have got what they wanted and will be happy with their performance.

What next is the question? After the euphoria will be consolidation. The US tapering is still a multimillion dollar question and there is no clarity on this subject as yet. Job data on Friday showed unemployment at 7% against 7.3% and the anticipated 7.2%. Under normal circumstances this would have meant that tapering would happen faster than expected but markets took it in their stride and posted an almost 200 point gain.

Well markets seem to have got over this concern as well. RBI money policy review would happen in the following week and expectations of a rate hike or status quo would determine market movement. Thereafter it would focus on anticipated quarterly results in the October-December quarter.

It would be of importance to see the action taken by FII’s post these results. They are a driving force and if they like the developments are markets are likely to remain buoyant for more time to come.

In conclusion markets are always driven by hope and expectation and we have it.