Sensex, Nifty log biggest single-day gain in 3 yrs as exit polls predict 3rd term for Modi govt

Mumbai: After the exit polls predicted the return of the Modi government for the third straight term, benchmark Sensex and Nifty zoomed more than 3 per cent on Monday, recording their biggest single-day gain in three years and closing at lifetime highs.

The 30-share BSE Sensex soared by 2,507.47 points or 3.39 per cent to settle at a new closing peak of 76,468.78 points with 25 of its constituents ending in the green and five in the red. During the day, the barometer jumped 2,777.58 points or 3.75 per cent to hit a record intra-day peak of 76,738.89.

The NSE Nifty climbed 733.20 points or 3.25 per cent to finish at 23,263.90. During the day, it soared 808 points or 3.58 per cent to hit a fresh intra-day all-time high of 23,338.70.

Sensex and Nifty logged their biggest single-day gains since February 1, 2021, when indices had jumped nearly 5% after the budget presentation. Interestingly, Sensex and Nifty had spurted more than 3 per cent on May 20, 2019, after the exit polls predicted a major win BJP-led NDA in the 2019 general elections.

Among sectors, PSUs, Power, Utilities, Oil, Energy, Capital Goods, and Realty indices soared up to 8 per cent.

A sharp rally in blue-chip stocks Reliance Industries, ICICI Bank, HDFC Bank and State Bank of India propelled the indices to lifetime high levels. Strong GDP data also added to the buoyancy in equity markets.

Shares of all Adani Group companies continued their rally on Monday, taking their combined market valuation to Rs 19.42 lakh crore. Adani Power surged nearly 16 per cent, Adani Ports by 10 per cent and flagship Adani Enterprises by over 6 per cent.

Exit polls on Saturday predicted that Prime Minister Narendra Modi will retain power for the third straight term, with the BJP-led NDA expected to win a big majority in the Lok Sabha polls. The counting of votes will take place on June 4.

"Nifty logged its best session in over three years, as investors cheered exit polls, along with better-than-expected India Q4 GDP," said Deepak Jasani, Head of Retail Research, HDFC Securities.

"The markets opened at new highs today largely because of exit polls predicting landslide victory for the BJP-led NDA. This will result in a positive surprise of policy continuity with higher seats for the NDA government," SAMCO MF Fund Manager & Head of Equity Research Paras Matalia said.

Among the 30-Sensex companies, NTPC, State Bank of India and Power Grid jumped over 9 per cent each. Larsen & Toubro, Axis Bank, Reliance Industries, UltraTech Cement, Mahindra & Mahindra, IndusInd Bank, ICICI Bank and Tata Steel were the other big gainers.

Sun Pharma, HCL Technologies, Asian Paints, Nestle and Infosys were the laggards.

Vinod Nair, Head of Research, Geojit Financial Services, "Exit poll has activated the optimism of a memorable 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, Nair added.

In the broader market, the BSE midcap gauge climbed 3.54 per cent and smallcap index jumped 2.05 per cent. Both the indices hit their all-time peaks in intra-day.

The market capitalisation of BSE-listed companies jumped to Rs 4,25,91,511.54 crore (USD 5.13 trillion).

As many as 2,346 stocks advanced while 1,615 declined and 154 remained unchanged on the BSE.

The market capitalisation of NSE-listed companies stood at Rs 422.48 lakh crore (USD 5.09 trillion).

India's economy grew by 8.2 per cent in the fiscal year that ended in March, cementing the country's position as the fastest-growing major economy in the world.

"Strong economic data like GDP growth of 8.2% in FY24, 100 days measures list and final budget will be the key points the market will observe in the coming weeks," Nair added.

In Asian markets, Seoul, Tokyo and Hong Kong settled with gains while Shanghai ended lower. European markets were trading in positive territory. US markets ended mostly higher on Friday.

Foreign Institutional Investors (FIIs) bought equities worth Rs 1,613.24 crore on Friday, according to exchange data.

Global oil benchmark Brent crude climbed 0.18 per cent to USD 81.26 a barrel.

Analysts said global equities began June mostly higher after a report showing that inflation in the US is not worsening led to a rally on Wall Street. European stocks rose and government bond yields dropped as investors anticipated an interest rate cut from the ECB (European Central Bank) later this week.