Okay, the results have surprised (or spooked?!) the markets. Investors have voted with their feet. Gloom and doom are almost palpable. Is this an opportunity to enter the market for the smart investor?

At the outset this is no prediction for the future course of the markets. This note is aimed at smart investors who are willing to take calculated risks.

Here is what smart investors should look at:

1. The Congress-led coalition is no stranger to reforms. The Congress is the one to initiate them in the first place. And not surprisingly, the man who led the charge, Dr Manmohan Singh in all probability will play a key role in the next government. So reforms will continue, but maybe in a different gear.
   
2. A stable government looks likely, though not certain. But it seems that we will not be cursed by a hung Parliament. If stability is what long-term investors want, we might just get the same.
   
3. The outlook for corporate profitability is intact. There is no change; fundamentals continue to be robust. Of course, with the Left Front as part of the government the divestment plan could be dealt a setback. This is a 'technical' development and it impacts very few companies.
   
4. With the likelihood of another normal monsoon, the second in succession, growth in domestic demand may not be an issue. This augurs well for the economy. Another plus point to look at for long-term investors.
   
5. Finally, markets tend to over react to situations like these thus throwing up opportunities to buy great stocks at reasonable valuations. If you have done your homework well and the numbers look good (long term), do not let the election results spook you!