Market fall on BJP's Bihar loss may be a buying opportunity: CLSA

As exit polls by various agencies suggest a close race between NDA and JDU-led Grand Alliance with a slight advantage for the latter in the Bihar elections, international brokerage firm CLSA said BJP-led alliance's loss will lead to more press hype that Prime Minister Narendra Modi's honeymoon period is over and that his reforms are failing.

Christopher Wood of CLSA said investors should view this as short term noise and use any significant weakness in the markets as a buying opportunity. However, he acknowledged that the current continuing earnings season has so far been relatively disappointing.

The coalition of local parties led by Chief Minister Nitish Kumar is expected to win 124 out of 243 seats in Bihar's assembly, giving them a majority, according to a simple average of the exit polls calculated by Reuters.

Benchmark CNX Nifty index tested its important support level of 7,950 ahead of key election results, due on Sunday.

CLSA added consensus has cut India's FY16 earnings estimates by 1 per cent since the beginning of the results season and 3.5 per cent over the past three months to October.