The Modi government's sudden decision to terminate the Rs 500 and Rs 1,000 notes is likely to jolt Indian markets. According to senior journalist Prakash Chawla, the market will open to a lot of confusion, which will result in a sharp decline.
A large section of Indian economy runs on the enterprises that deal in cash - like markets. With the 500 and 1000 notes being made invalid, the move is likely to have a direct impact on these businesses. However, the confusion will only be short-term, Chawla said.
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Meanwhile, the ruling government has announced that banks will be shut for public dealing today so as to prepare for the new changes in policy. Similarly, ATMs will also remain shut for two days.
Another factor that is bound to have a major impact on the Indian market is the result of the United States Presidential elections. Early trends show that Republican nominee Donald Trump is leading the race to the White House.
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The US Dollar has reportedly tumbled following the news of Trump's lead in the polls, a development that is also bound to pull down the Indian market.