Bull market logic

In four of the first five months of this year, foreign investors were big sellers, but they have changed tack and are now sailing with the wind

On June 4, the Lok Sabha election results shocked the markets and jolted the ruling Bharatiya Janata Party. But the markets were perturbed for barely two hours. By noon, stocks started recovering and within a week surpassed the all-time high it had hit just before the election results. A month later, as the steady upward drift continued, the indices were much higher still, belying worries about a hobbled minority government. On the day the Union Budget was announced, the markets fell due to the imposition of higher taxes on capital gains. Investors took two days to digest