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To question the dominance of Narendra Modi and his Bharatiya Janata party once seemed unthinkable. But voters in the world’s largest democracy have denied the leader a third consecutive parliamentary majority.

Modi will now be reliant on his smaller partners with horse-trading required to thrash out a government in the coming weeks. The good news for most investors is that the broader economic growth story of the past few years looks intact. But Modi-affiliated stock market darlings — such as Adani Enterprises, owned by Gautam Adani and up 7,000 per cent since 2014 — may have had their best days.

Local investors understandably hated that notion, knocking the benchmark Nifty 50 stock index down almost 6 per cent, led by Adani Ports and Adani Enterprises, which were both down one-fifth on the day.

Under Modi’s rule, the Indian stock market has flourished. It hit a fresh high on Monday on expectations of a BJP landslide and a third term for the prime minister. Indian stocks have risen more than 30 per cent over the past year versus gains of a quarter for the MSCI All-World index.

This completes a decade of global outperformance. India has also far outrun Chinese equities — flat over the decade following their post-pandemic declines.

Investors hope for policy continuity and further economic liberalisation. Modi’s vast infrastructure investment programmes in road and rail transportation, for example, should underpin India’s next five years of growth.

The private sector was already expected to pick up much of the investment tab, with government debt high at 80 per cent of gross domestic product. The country is only in the first third of a decade-long infrastructure cycle, say bulls at Bank of America.

Investor enthusiasm on this theme has pushed up equity valuations to historical highs. The Indian market, at 23 times forward earnings, trades at the top of its five-year range.

Further gains will depend on earnings growth: Nifty 50 earnings per share should grow at roughly 10 per cent annually through 2026, according to Bloomberg. Foreign inflows to stocks and bonds over the past year are at the highest levels since 2014.

The financial sector may offer an opportunity. Large private sector banks remain cheap by historical standards, says Ashmore’s Rashi Talwar. HDFC bank trades at 2.5 times book value, well below its past average of more than 3 times.

This whipsaw in Indian equities suggests that earnings need to catch up with share prices. But the transformation of the country’s economy should continue to mean growth in the medium term.

andrew.whiffin@ft.com

CNN
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June 6, 2024 marks 80 years since D-Day, the first day of the Normandy landings that laid the foundations for the Allied defeat of Nazi Germany in World War II.

The invasion – codenamed Operation Overlord – saw of tens of thousands of troops from countries including the United States, the United Kingdom and Canada landing on five stretches of the coastline of Normandy, France – codenamed Utah, Omaha, Gold, Juno and Sword beaches.

Planning for D-Day began more than a year in advance, and the Allies carried out substantial military deception to confuse the Germans as to when and where the invasion would take place.

The operation was originally scheduled to begin on June 5, 1944, when a full moon and low tides were expected to coincide with good weather, but storms forced a 24-hour delay. Allied divisions began landing on the five beaches at 6:30 a.m. on June 6.

What does D-Day stand for?

The term ‘D-Day’ was military code for the beginning of an important operation, with the first ‘D’ being short for ‘Day.’ This means that D-Day actually stands for ‘Day-Day.’

According to the Royal British Legion, the phrase ‘D-Day’ was used fairly often before the Allied invasion in June 1944. After this, however, the two became synonymous, and now D-Day is commonly understood to refer to the beginning of Operation Overlord.

D-Day saw unprecedented cooperation between international armed forces, with more than 2 million troops in the UK in preparation for the invasion, according to the Imperial War Museums (IWM).

Most of these troops were American, British and Canadian, the IWM reports, but troops also came from Australia, Belgium, the Czech Republic, France, Greece, the Netherlands, New Zealand, Norway, Rhodesia (now Zimbabwe) and Poland to participate in Operation Overlord.

The Allied troops’ invasion was coordinated across air, land and sea, in what can be described as amphibious landings.

These were preceded by an extensive bombing campaign to damage German defenses, as well as the employment of deception tactics.

Operation Bodyguard was an umbrella term for the deception strategy leading up to the Allies’ invasion of Europe in June 1944. Operation Fortitude was a tactic under this umbrella specifically related to the Normandy invasion, and was intended to make Nazi Germany believe that the initial Normandy attacks were merely a diversion and that the true invasion would take place elsewhere.

According to the IWM, Fortitude North intended to trick the Germans into believing that the Allies would attack Norway, and Fortitude South was designed to convince the Germans that the Allies were going to invade Pas de Calais, a French department northeast of Normandy that is closer to the UK.

The US troops were assigned to Utah beach at the base of the Cotentin Peninsular and Omaha Beach at the northern end of the Normandy coast. The British subsequently landed on Gold Beach, followed by the Canadians at Juno, and finally the British at Sword, the easternmost point of the invasion.

By midnight, the troops had secured their beachheads and moved further inland from Utah, Gold, Juno and Sword.

However, not all the landings were successful; US forces suffered substantial losses at Omaha Beach, where strong currents forced many landing craft away from their intended positions, delaying and hampering the invasion strategy.

Heavy fire from German positions on the steep cliffs, which had not been effectively destroyed by Allied bombing before the invasion, also caused casualties.

According to the IWM, Germany’s reaction to Operation Overlord was “slow and confused.”

Weather conditions on June 6 were still poor, many senior commanders were not at their posts, and Operation Fortitude convinced Adolf Hitler that the Normandy invasion was a feint before a bigger attack at Pas de Calais.

Germany’s air force was in action elsewhere, countering American bombing operations over Germany. Its navy ships were docked in ports or already destroyed by the Allies. This left only the German army to defend against Operation Overlord, according to the IWM.

On top of this, the success of Operation Fortitude meant that many army units were kept away from the Normandy battlefield until July, as an attack in Pas de Calais was still expected.

German troops manning coastal defenses “did as much as they could have been expected to,” the IWM says, before eventually being “silenced” and Allied units advanced inland.

On D-Day alone, around 4,440 Allied troops were confirmed dead, according to the Commonwealth War Graves Commission (CWGC), with more than 5,800 troops wounded or missing.

Because Omaha Beach was the bloodiest landing beach, the US Army lost the most men in the amphibious landings. Some 2,500 American troops died in the beach assault and airborne operations on D-Day, according to the CWGC.

The precise number of German casualties on the day is unknown, but they are estimated to be between 4,000 and 9,000.

Of the tens of thousands of troops that stormed the beaches of Normandy on D-Day, 44 were soldiers, sailors and airmen from Bedford, Virginia, in the US.

Within minutes of reaching Omaha Beach, 16 of these men were killed and four were wounded. Another Bedford soldier was killed elsewhere on Omaha Beach, and three others were presumed killed in action, bringing Bedford’s D-Day fatality figure to 20 men.

According to the National D-Day Memorial Foundation, Bedford suffered the highest known per capita D-Day loss in the US.

Despite securing a stronghold on the French coast on D-Day, the Allied forces faced the risk that German bombardment could push them back into the sea.

They needed to build up troop numbers and equipment in Normandy faster than the Germans, allowing for a continued invasion into mainland Europe.

The Allies used their air power to slow the German advance toward Normandy by blowing up bridges, railways and roads across the region. This allowed the Allies to gain total control of Normandy 77 days later and move on toward Paris, which they liberated in August 1944.

The US Department of Defense calls D-Day the “successful beginning of the end of Hitler’s tyrannical regime.” The IWM calls it the “most significant victory of the Western Allies in the Second World War.”

By being able to get forces into Normandy, the Allies were able to begin their advance into northwest Europe. Though World War II lasted nearly another year in Europe, the success of Operation Overlord led to the liberation of France and allowed the Allies to fight the Germans in Nazi-occupied Europe.

The US’ National World War II Museum says that a good way to appreciate the significance of D-Day is to imagine what would have happened if the operation had failed. According to the museum, another landing would have not been possible for at least a year.

In this time, Hitler could have strengthened Nazi-occupied Europe’s coastal defenses, developed aircraft and weapons, bombed the UK even more heavily and continued his killing campaign, the museum says.

Fighting by the Allies on the western front and Russian soldiers on the eastern front eventually led to the defeat of the German Nazi forces.

On May 7, 1945, the German Third Reich signed an unconditional surrender at Reims, France. Victory in Europe (V-E) Day is celebrated the following day as that’s when the armistice went into effect.

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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

India’s Prime Minister Narendra Modi is set to win a historic third term in office after a partial vote count published on Tuesday showed his Bharatiya Janata party and its partners on course to win re-election, albeit with a smaller majority.

As of early Tuesday afternoon, the BJP and its National Democratic Alliance allies were ahead in at least 293 of 543 seats in India’s lower house, allowing it to secure a third five-year term and form the next government.

Early trends showed the opposition INDIA alliance, led by the BJP’s arch-rival the Indian National Congress, performing better than expected and winning 229 seats.

The prospect of a reduced majority for the ruling party prompted a sharp sell-off in Indian stocks. The benchmark Nifty 50 index tumbled as much as 8.5 per cent, erasing its gains for the year, after having surged to a record high on Monday following exit polls that had indicated Modi would win the election comfortably.

The exit polls released over the weekend after the end of voting had projected the ruling alliance to win between 353 and 401 seats. During the campaign, Modi and the BJP forecast the NDA would win as many as 400 seats.

If confirmed, Modi’s victory would make him India’s first prime minister to serve three consecutive terms since independence leader Jawaharlal Nehru and empower him to continue his project of reshaping politics, the economy and society in the world’s most populous country.

However, a smaller majority would make the powerful Indian leader more beholden to his smaller allies in the NDA than before.

“If the numbers don’t change, it’s a return of alliance politics that had characterised India from 1989 to 2014,” said Pratap Bhanu Mehta, senior fellow at the Centre for Policy Research in New Delhi. “In that sense, it will have to be a much more negotiated government.”

He added: “I’m not sure how much business will like it.”

The stock market fall was driven by a sell-off in companies related to infrastructure, a critical policy initiative under the BJP. Shares of Adani Ports, Adani Enterprises and Oil and Natural Gas Corporation led losses, dropping as much as 25 per cent, 25 per cent and 21.5 per cent, respectively.

Many Indians had expected a clear Modi victory in an election seen as a referendum on his decade in office and following a campaign focused largely on the personality of the 73-year-old prime minister.

But early voting trends on Tuesday showed the BJP on track to fall short of a parliamentary majority of 272 on its own, which it enjoyed during Modi’s first two terms. The party was also projected to lose some seats in its northern Hindi-speaking political stronghold, including the most populous state Uttar Pradesh.

Final results are expected late on Tuesday evening or Wednesday morning. Results were the culmination of a staggered six-week polling process that began in April.

Voting in India is held in phases due to the logistical and security challenges in a country of more than 1.4bn people. The Election Commission of India said 642mn of nearly 1bn registered voters cast their ballots.

Additional reporting by William Sandlund in Hong Kong