How will the markets interpret the outcome of Karnataka Assembly polls?

The outcome of the Karnataka state elections can trigger a knee-jerk reaction in the markets at best, believe analysts, as they have other things such as progress of monsoon, falling rural demand, corporate results for the March 2022 quarter (Q4-FY23) to worry about over the next few months. At the global level, interest rate trajectory of central banks, crude oil prices, movement of the dollar index and geopolitical situation are some of the factors that will be keenly watched.

The outcome of a state election, analysts believe, does not necessarily determine the outcome of the national elections. In the past,