Indian stocks emerged as the best performers among all emerging markets across the globe, giving the highest return of over 3 per cent on the day before the outcome of general elections in the country.
According to an analysis of MSCI Barra indices, a measure of returns from various stock markets across the world for foreign investors, Indian stocks gained 3.21 per cent on Friday last week on expectations of formation of a stable government.
The various emerging markets across Asia, Europe and Latin America underperformed the Indian stocks that day giving returns between 0 and 2 per cent.
Indian stocks also outperformed its peers from the BRIC nations with Chinese equities advancing 1.43 per cent, Russia 0.33 per cent and Brazil gaining 0.24 per cent.
The 30-share benchmark index of Indian stocks, Sensex, gained over 300 points to settle at 12,173 points on May 15.
Analysts said the expectations of the election results had propelled a choppy trade in the equities market last week, but on the last day of trade hopes of a stable government formation had fueled a 300 points recovery.
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Indian stocks have even outperformed the (Morgan Stanley Composite Index) MSCI Barra's emerging market index, which includes all the developing world markets, giving returns to foreign investors of 1.22 per cent on May 15.
Other emerging markets which gave over 2 per cent return on Friday last week include Thailand (2.72 per cent), Hungary (2.62 per cent), Chile (2.44 per cent), Philippines (2.19 per cent) and Taiwan (2.15 per cent).
After losing nearly 50 per cent in the past one year, Indian stocks have gained over 22 per cent in the first four months of this year.
In the past week, the Sensex saw volatile trade and swung between negative and positive territory but managed to end the week with a gain of nearly 300 points over the previous week.
Further, as it is now clear that the UPA would form the government again and without the Left support this time, most market experts anticipate a rally between 400-700 points, some of them said the surge could be as high as 800-1,000 points tomorrow — the first trading day after the announcement of the election results for the 15th Lok Sabha.