The Securities and Exchange Board of India (Sebi) has not received any specific information regarding unfair trading in the stock markets on the day Lok Sabha election results were announced, minister of state for finance Pankaj Chaudhary told Parliament on Monday.
The Sensex has fallen nearly 6% on June 4, recording one of its biggest declines in recent years, as the incumbent BJP failed to secure a simple majority on its own. The overall investor wealth tumbled by more than Rs 30 trillion.
The controversy arose as the 30-stock index, Sensex, jumped over 3% a day earlier after exit polls had predicted a thumping majority for the incumbent government.
“Though Sebi has received representations on the above stock market movements, no specific information on any unfair trading has been provided,” Chaudhary said in a written reply to a query in the Lok Sabha.
Stock market movements are a function of investor perceptions along with other factors which may include global economic scenarios affecting foreign capital flows, domestic macroeconomic parameters and the overall corporate performance, he said.
The minister added that benchmark indices recovered from their election-day losses in the next three days, while the market capitalisation was recovered in the next five sessions.
The election outcome came as a surprise to investors who were expecting the results day to be a non-event session as the victory of the incumbent seemed almost certain. However, despite the unexpected verdict, the market saw a strong recovery in the following days.
The Sensex is up by around 12% after the poll results. The BSE small-cap index and the BSE midcap gauge have surged around 18% and 15%, respectively, in the same period.