The Mahagathbandhan of JDU, RJD and Congress has swept the Bihar polls and the BJP led NDA is a poor second. No exit polls got it right and the margin of error was huge. The fact that the party has won by about a 3/4th majority and the closest that pollsters predicted was the NDA win by one pollster and most said that the Mahagathbandhan was ahead. A 3/4th majority is not being ahead, but is a landslide win.

Our markets have been sensing this loss but not this magnitude. They have been correcting since they peaked on the 26th of October, with the BSESENSEX at 27,618 points. They have from there lost close to 5% or over 1,300 points. It’s a decent fall and more or less covers the loss of Bihar. However the magnitude of loss will jolt the party and therefore there will certainly be weakness today. At what level and when the markets reverse, whether today or tomorrow is a bit difficult. The positive factor would however be that there was no long build-up whatsoever.

In primary market news, the listing of Coffee Day Enterprises was a disaster and the share closed day one and the week at similar levels of Rs 270 against the issue price of Rs 328. The company declares its results for the September quarter today and one would have to wait for the same to see whether the company has turned around or not.

The issue from Indigo owner Interglobe Aviation lists tomorrow. This would be the mega issue to list and one is reminded of another issue which listed between ‘Dhanteras’ and Diwali Muhurat day five years ago. Readers would recall that Coal India listed on the same day five years ago and what happened thereafter is history. Let us hope that history does not repeat itself.

This week is the festival week and barring today when there would be hectic activity post the Bihar poll outcome, volumes would tend to drift downwards. Wednesday is Muhurat which is more of token trading and Thursday is a holiday. With restricted trading and therefore volumes, volatility is likely to increase.

Use sharp dips to add to your investments or generally stay away from the market in this festival week.

Wishing all my readers, a Happy Diwali and Prosperous New Year.