Where should you invest now? Modi’s NDA government elected to power …

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The stock markets have been in a buoyant mood ever since Narendra Modi was named the BJP’s prime ministerial candidate on 13 September last year. With Indian voters giving the National Democratic Alliance (NDA) a clear mandate, the markets turned euphoric. On the 16 May, the day of vounting, the Sensex opened up by more than 1,000 points and then breached the historic 25,000 mark.

Now that the markets have safely negotiated possibly the year’s biggest event risk, retail investors need to reformulate their stock market strategy: should those who have been sitting on the sidelines enter the markets now in anticipation of the bull run continuing? And, for those who entered the markets earlier, is it time to book profits in view of stretched valuations?

Investors with a short-term investment horizon, who have made substantial profits from the current run-up, may encash their gains. “Investors who got in at lower levels should book partial profit and wait for a correction to re-enter.

Long-term investors, on the other hand, may continue to hold on to their investments. “The overall long-term trend is positive,With the NDA winning a clear mandate, the surge in economy-related stocks may continue. Enter these sectors whenever the markets take a breather. the executive wing of the government is likely to work with a sense of urgency, sectors like infrastructure, construction, capital goods and power are expected to fare well.

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