Rupee Gains, Sensex Surges After Exit Polls Point to Sweeping Victory by BJP
Exits polls, following the mammoth seven-phase voting, showed Narendra Modi's National Democratic Alliance (NDA) projected to win between 339 and 365 seats in the 545-member lower house of parliament.
Indian shares surged, while rupee rallied on Monday, a day after exit polls showed Prime Minister Narendra Modi would retain power with a bigger majority in the parliament, with financials leading the charge.
Exits polls, following the mammoth seven-phase voting, showed Modi's National Democratic Alliance (NDA) projected to win between 339 and 365 seats in the 545-member lower house of parliament.
Despite facing criticism for weak job growth and farm prices, Modi turned the campaign into a fight for national security after tensions with Pakistan escalated earlier this year.
"I expect another 2-3% rally in the market in the next 3-4 days based on the cue," said Samrat Dasgupta, a fund manager at Esquire Capital Investment Advisors.
"But once the results are out on Thursday, even if it is as expected, I don't see much upside to the market."
"The economy is passing through a rough patch because a lot of data indicators are showing a slowdown, so people will wait for announcements from the new govt/cabinet to see what policies will be made," Dasgupta said.
The broader NSE Nifty was up 2.22% at 11,660.45 as of 0347 GMT, while the benchmark BSE Sensex was 2.31% higher at 38,807.88.
India's NSE stock futures listed on the Singapore exchange, an indicator for the broader NSE Nifty, was up 2.02% as of 0348 GMT, after rising as much as 2.76%.
Financial stocks led gains, boosted by Yes Bank Ltd, which was up 6.2%, and State Bank of India Ltd, which surged 5.4%.
The Nifty IT index was down 1%, dragged by Infosys Ltd's 1.3% fall, as the rupee rallied.
The partially convertible rupee was trading at 69.49/50 per dollar at 0343 GMT, after rising to 69.3550 earlier, making it up 1.2 percent on the day. The gain, if sustained, would be the highest since December.
The rupee had closed Friday at 70.22. Further gains in the rupee will also depend on flows into the stock markets.
The benchmark 10-year bond yield was trading at 7.30 percent, down 6 basis points on the day after briefly falling to a low of 7.28 percent.
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