India’s equity market on Monday witnessed one of its most stellar rallies of recent years following the exit poll results which show a comfortable majority for the NDA alliance led by Prime Minister Narendra Modi.
The NSE Nifty 50 gained 733.20 points or 3.25% to settle at 23,263.90, while the BSE Sensex jumped 2507.47 points or 3.39% to 76,468.7. During the intraday session, the Sensex peaked at 76,738.89 while the Nifty touched a fresh high of 23,338.70.
The market capitalisation of all listed companies on the BSE surged by Rs 14 lakh crore to Rs 426.1 lakh crore.
Santosh Meena, Head of Research at Swastika Investmart, said if the exit poll results are confirmed by the actual election outcome, there could be further gains, with the Nifty possibly advancing towards 23,500 and Sensex approaching 77,000. Most of the exit polls on Saturday predicted that the BJP-led NDA may win over 350 of the 543 seats in the Lok Sabha.
“In the near term, we might observe consolidation within the 23,000 to 23,500 range for Nifty. Despite this, the overall trend remains bullish, and Nifty is expected to surpass the 24,000 mark in the coming days after a period of consolidation. This is supported by the attractive valuations in large-cap stocks and the anticipated increase in foreign institutional investor (FII) inflows into the Indian market following the election results,” added Meena.
In the broader market, BSE Midcap rose 3.5% while BSE Smallcap gained over 2%. Among sectoral indices, Nifty PSU Bank rose 8.6%, followed by gains in Nifty Oil & Gas (7%) and Nifty Realty (5.7%). In the Nifty50 pack, NTPC, SBI, and APSEZ were the top gainers in Nifty 50 as the stocks rose 9.3-10.6%.
Analysts also attributed the Monday rally to India's GDP exceeding estimates at 8.2 percent for FY24 and a 10% rise in GST collections to Rs 1.73 lakh crore in May.
"The exit polls have activated the optimism of a win for the ongoing government. PSUs had a humongous rally, in anticipation of continuation of the reform gains, triggering further re-rate. The sustenance of the broad rally is anticipated to continue in line with the magnitude of the actual tally, as inflows pour in which were sitting on the sidelines in the last three months. Strong economic data like GDP growth of 8.2% in FY24, 100 days measures list and final budget will be the key points market will observe in the coming weeks,” said Vinod Nair, Head of Research, Geojit Financial Services.