Indian Stock Market Soars as BJP Wins State Elections
In early trade on Monday, India’s benchmark indices, the Nifty and the Sensex, surged over 1% to hit new highs. The rise comes after the ruling Bharatiya Janata Party (BJP) secured victory in three of the four states that held elections on Sunday.
Leading the market surge were Adani Group stocks, with Adani Enterprises and Adani Ports becoming two of Nifty50’s top five gainers, and four of the five top gainers on BSE. The group’s combined market cap crossed ₹12 lakh crore in morning trade.
The other top gainers in morning trade included Bharti Airtel, NTPC, and State Bank of India, with expectations of an across-the-board rally driven favorable GDP and retail inflation data, along with the state election results.
Nifty50 soared over 270 points, comfortably crossing the 20,000 mark after hitting a lifetime high the previous week. Similarly, the Sensex jumped over 998 points in early trade, reflecting the market’s euphoria over BJP’s election victories.
In addition to the political developments, the stock market rally has been supported positive data points, including India’s second-quarter GDP growth of 7% and retail inflation dropping to 4.87% in October.
The favorable sentiment has extended to the global market, with the US 10-year bond yield declining to 4.23%. Experts anticipate a widespread rally in stocks, and investors globally are awaiting the December Santa Claus Rally with optimism.
Looking ahead, Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, stated, “Market likes political stability and a reform-oriented, market-friendly government. The market has already partly discounted a BJP victory with a 500 point rally during the last 4 sessions. But the mood is so exuberant that the rally will continue.”
Overall, the stock market’s surge has been attributed to the BJP’s election victories, positive economic data, and global market optimism, setting the stage for continued gains in the coming days.