Indian Benchmark indices surged to record closing levels on Monday, as exit polls predicted the NDA win in the Lok Sabha elections 2019. The exit polls indicated Prime Minister Narendra Modi would retain power with an even bigger mandate than in 2014. Analysts believe the investor sentiments are secured with the idea of a stable government. The possibility of the BJP returning to power also means further push on the previous policies, as the second five-year term is needed for implementing such reforms. With the BJP government's focus on developing infrastructure, expectations are that if the stable government is formed in 2019 such policies will continue.
Positive equity market sentiments propelled indices upwards as all them closed in the green. The biggest move was seen on Nifty PSU banks that closed at 7.88 per cent gain, followed by realty that closed with a gain of 5.72 per cent. Private banks, metal, auto and financial services each gained over 4 per cent. However, IT and Pharma were trading in the negative zone in the early session and closed 0.79 per cent and 0.67 per cent up later in the day. India Vix, which indicates the expected market volatility over the next 30 calendar days, has lowered down to 23.6750 by the closing bell, down 4.40 or 15.67 per cent against the previous close of 28. India Vix value was standing at 29.32 on May 16, 2019, also its 52-week high.
Moreover, Sensex and Nifty closed marginally short of their all-time highs. While Sensex --- at the closing value of 39,352.67 -- stands 134.78 or 0.34 per cent away from the 52-week high of 39,487.45, NSE Nifty's closing value of 11,828.25 is mere 27.9 points or 0.23 per cent away from the 52-week high of 11,856.15, as per the closing figures available with the exchanges. On the currency front, Rupee opened higher by 73 paise at 69.49 per dollar on Monday and closed at 69.74 against the dollar against the Friday's close of 70.22 per dollar. According to the data available with exchange platforms, total traded value for the equity segment on the NSE stood at around Rs 43,803.31 crore with 20003.91 lakh shares changing hands and at Rs 3,586 crore on the BSE, with 2,335.12 lakh shares as the trading volume.
The market breadth was tilted in favour of buyers, with 1423 stocks closed with buying interest on the NSE against 252 declining ones and 68 unchanged stocks. On the BSE, 1997 stocks were advancing while 656 stocks closed and 162 unchanged stocks at the closing bell. Adani Enterprises, Reliance Power, Jamna Auto, GE T&D India and Indian Telephone Industries, were among the top gainers on BSE, while Adani Ports, Indiabulls Housing Finance, IndusInd Bank, SBI Bank and Tata Motors were the top gainers on NSE. Except for Bajaj Auto and Infosys, all the index scrips settled with gains.
"The exit polls would be seen as a modest positive for the Indian stock market as the market was largely factoring in the return of the BJP-led NDA government," Kotak Institutional Equities said in a research note. The report noted that the market is largely factoring in the return of the BJP-led government. "We could see a small rally post-May 23 election results if the results are in line with the market's expectations," it noted.
(Edited by Rupa)