Investor sentiment was buoyed by the prospect of continued investment in infrastructure and manufacturing under PM Modi's leadership. This is why Nifty Energy, Nifty PSU Bank, and Nifty Realty were the top gainers, each rising between 4-5%.
The market capitalisation of all listed companies on the BSE jumped by over Rs 11 lakh crore, making investors richer.
Key sectors such as PSU banks, oil and gas, financial services, metals, realty, and auto saw gains of 3-5%.
Exit poll euphoria Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said, "Dalal Street is poised for a strong start to June driven by optimistic exit poll results predicting a significant win for the BJP-led NDA."
Meanwhile, Ravi Singh, Senior Vice President of Retail Research at Religare Broking, also highlighted that all the exit polls suggest a BJP victory, which has positively impacted the markets.
"However, election-related uncertainty could lead to volatility. Investors should be prepared for fluctuations but remain optimistic about a potential rally if final results align with exit polls," Singh added.
Exit poll averages indicate the BJP-led NDA will secure around 370 seats in the Lok Sabha election on June 4.
A strong victory for the BJP-led NDA, as predicted by the exit polls, is expected to give Prime Minister Narendra Modi the political leverage to implement tougher land and labour reforms, according to market experts. Investors also anticipate the Modi administration will continue efforts to establish India as a global manufacturing hub, attracting foreign companies like Apple and Tesla to diversify their production beyond China.
Strong GDP growth
Another factor contributing to today's positive rally is India's GDP growth numbers for FY24 and the fourth quarter, released last week. India's economic growth accelerated to 8.2% for the financial year ending March 2024, driven by government spending on infrastructure and a real estate boom, as reported last week.
"Key catalysts include India’s GDP exceeding estimates at 8.2% for FY24, a surge in Dow Jones by 574 points, increased odds of a September rate cut, early monsoon advancement, and a 10% rise in GST collections to Rs 1.73 lakh crore in May," Tapse said.
