JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA

Arshi Firdous; Sarbapriya Ray

doi:10.17261/Pressacademia.2025.2002

JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA

Abstract

Purpose- This study tries to evaluate the influence of election’s results on India's BSE and NSE exchanges at different election time frames. It assesses efficiency of Indian financial market at the time of election and to enquire into the fact whether there exists any immediate effects in terms of sudden changes in stock prices/returns and market volatility on market dynamics as a result of declaration of election result. Methodology- The study is purely based on secondary data and the general elections for the year 2004, 2009, 2014, 2019 and 2024 have been considered. The study used descriptive and analytical method to achieve the desired objective. Monthly along with daily closing prices have been used for BSE and NSE and the volatilities of the stock market before and after 30 days, 15 days and 3 days have been considered for analytical purpose. Actual Return has been calculated using the log difference of previous price and current priceRt= ln(Pt-Pt-1), where P is the price ,Ln is natural logarithm and t is the time period and Rt is Actual Return. Paired t test is used to measure if there is any significant mean difference between the two paired samples. Findings- It has been found that market volatility increases before election results are announced and continue to adjust afterward in India. Results indicate that election results have a limited and temporary impact on returns and volatility, with short-term volatility occurring but not long-term impacts.The analysis of variance indicated that variance in both shorter and longer period [(- 3,+3) days (-30,+30) is not so much statistically prominent, although smaller ups and downs are noticed .This suggests that market volatility is transient and corrects itself over time in India. Moreover, SENSEX return declines gradually in different election times commencing from 2004 till 2024 emphasing the fact that political regime change has initially a little bit notewotrthy impact on stock market returns. Conclusion- This empirical investigation should be construed as an endeavour in understanding stock price, stock return and general election dynamics in the context of the India’s parliamentary political backdrop.

Keywords

References

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Details

Primary Language

English

Subjects

Finance and Investment (Other)

Journal Section

Research Article

Authors

Arshi Firdous This is me
0009-0004-6334-2224
India

Sarbapriya Ray This is me
0000-0002-5848-4824
India

Publication Date

December 31, 2025

Submission Date

August 7, 2025

Acceptance Date

November 11, 2025

Published in Issue

Year 2025 Volume: 12 Number: 2

DOI

https://doi.org/10.17261/Pressacademia.2025.2002

IZ

https://izlik.org/JA36TS72TN

Cite

RIS / Bibtex

APA

Firdous, A., & Ray, S. (2025). JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA. Journal of Economics Finance and Accounting, 12(2), 82-91. https://doi.org/10.17261/Pressacademia.2025.2002

AMA

1.Firdous A, Ray S. JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA. JEFA. 2025;12(2):82-91. doi:10.17261/Pressacademia.2025.2002

Chicago

Firdous, Arshi, and Sarbapriya Ray. 2025. “JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA”. Journal of Economics Finance and Accounting 12 (2): 82-91. https://doi.org/10.17261/Pressacademia.2025.2002.

EndNote

Firdous A, Ray S (December 1, 2025) JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA. Journal of Economics Finance and Accounting 12 2 82–91.

IEEE

[1]A. Firdous and S. Ray, “JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA”, JEFA, vol. 12, no. 2, pp. 82–91, Dec. 2025, doi: 10.17261/Pressacademia.2025.2002.

ISNAD

Firdous, Arshi - Ray, Sarbapriya. “JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA”. Journal of Economics Finance and Accounting 12/2 (December 1, 2025): 82-91. https://doi.org/10.17261/Pressacademia.2025.2002.

JAMA

1.Firdous A, Ray S. JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA. JEFA. 2025;12:82–91.

MLA

Firdous, Arshi, and Sarbapriya Ray. “JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA”. Journal of Economics Finance and Accounting, vol. 12, no. 2, Dec. 2025, pp. 82-91, doi:10.17261/Pressacademia.2025.2002.

Vancouver

1.Arshi Firdous, Sarbapriya Ray. JUDGING ELECTION IMPACT ON STOCK MARKET: EVIDENCE FROM INDIA. JEFA. 2025 Dec. 1;12(2):82-91. doi:10.17261/Pressacademia.2025.2002