Finally, exit polls have given some hope of stable government but considering past track record of +/- 10-15% deviation in numbers, risk to financial market has already been built up. BJP with 285+ seats and NDA
with +310 seats are good for market but that should not last long as real concerns on economic slowdown will come into play. Will poll numbers behave like 2014 or 2004? Need to cross fingers till 23rd May. RBI June policy will have to be watched as how banking regulator will respond to inflationary concern, trade war and slowdown in economy. Market consensus is for 25 basis point reduction. Liquidity should be the concern till the time new govt
come into power and start full fledged fiscal operation. Trump's soft stance on trade dispute with EU, Japan, Canada and Mexico is a positive move but major dispute is in between top 2 economies of the world. $ 738 billion of goods and services trade between global giants is at risk. Apart from this, Japan's capital good exports to China, Australia's commodities
export to China, Korea's semiconductor and Tourism
exports to China are also at risk. Crudeoil is still not cooling off from recent peaks. Skymet's prediction of below average monsoon is risk to inflation
.Risk reward balance is still tilted towards risk. Investors in market should wait for clear directional close above 11900 to understand big investor's appetite for risks.