Sensex Returns Under the Governments Which Have Formed Till Now

Indian stock markets staged a strong comeback on Wednesday, erasing losses from the previous day’s plunge. This surge follows the NDA’s commitment to support the alliance in forming a third-term government.

Data shows the Sensex, India’s one of the main stock market index, jumped 2,303 points (3.2%) to settle at 74,382. The Nifty 50 also surged over 735 points (3.36%) to close at 22,620. In the broader market, the mid-cap and small-cap indices also rose significantly.

The Sensex is often considered a gauge of India’s economic health and investor confidence. By analyzing Sensex returns under different governments, we can gain valuable insights into how the market reacts to various economic policies and political stability.

Atal Bihari Vajpayee’s NDA Government (October 6, 1999 to May 13, 2004)

Under the NDA government led by Prime Minister Atal Bihari Vajpayee, from October 6, 1999, to May 13, 2004, the Sensex saw modest growth. The index moved from 4,621.96 to 5,399.47, resulting in a return of 16.82%. This period was notable for infrastructure development and efforts towards economic liberalisation, although it was also impacted by geopolitical tensions and global economic conditions.

First Term: Manmohan Singh’s UPA Government (May 13, 2004 to May 16, 2009)

The first term of Manmohan Singh’s UPA government experienced the highest return among the observed periods. The Sensex surged from 5,399.47 to 14,284.21, delivering a remarkable return of 164.55%. This phase was marked by strong economic growth, the implementation of several key reforms and policy decisions, and India’s increased integration with the global economy.

Second Term: Manmohan Singh’s UPA Government (May 16, 2009 to May 16, 2014)

In the second term of the UPA government led by Prime Minister Manmohan Singh, the Sensex increased from 14,284.21 to 24,121.74, translating to a return of 68.87%. This period saw recovery post the global financial crisis, bolstered by robust domestic consumption and significant policy measures aimed at financial inclusion and rural development.

First Term: Narendra Modi’s NDA Government (May 16, 2014 to May 23, 2019)

During Narendra Modi’s first term from May 16, 2014, to May 23, 2019, the Sensex rose from 24,121.74 to 38,811.39, yielding a return of 60.90%. Key initiatives during this term included the introduction of the Goods and Services Tax (GST), the Make in India campaign, and various other reforms aimed at improving the ease of doing business.

Current Term: Narendra Modi’s NDA Government (Feb 23, 2019 to Jun 5, 2024)

Under the current NDA government led by Prime Minister Narendra Modi, the Sensex has seen a significant rise. Starting at 38,811.39 on February 23, 2019, the Sensex climbed to 74,382.24 by June 5, 2024, marking an impressive return of 91.65%. This period has been characterized by significant economic reforms, a strong focus on digital infrastructure, and substantial foreign investment inflows.

Conclusion

The analysis of Sensex returns across different government terms reveals varying degrees of market performance, influenced by economic policies, global conditions, and investor sentiment. The highest returns were recorded during Manmohan Singh’s first term, reflecting strong post-liberalisation growth and global economic integration. Narendra Modi’s terms have also shown robust performance, underpinned by significant economic reforms and investor confidence.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.