Sensex gains 1% to hit new high after exit polls back Narendra Modi as PM

 

Mumbai: Sensex, India’s benchmark equities index, scaled a fresh high on Tuesday, rising 1.14% to 23,820 points in morning trade, as exit polls predicted that Narendra Modi-led Bharatiya Janata Party (BJP) is likely to form the next coalition government.

The broader 50-share Nifty index on the National Stock Exchange also expanded 1.1% to 7,091 points.

“We expect further 5-10% gains in the market in the whole week,” said Rakesh Arora at Macquarie Capital Securities (India) Pvt. Ltd, a brokerage.

A positive election outcome was probably not yet be priced in, and indicative levels for the Nifty in this euphoric scenario, taking in 15% earnings growth expectations for 2014-15, would be near 7,800 points, analysts Gautam Chhaochharia and Sanjena Dadawala of financial services firm UBS said in a note after results of exit polls were broadcast on Monday.

“In our view, a more euphoric sentiment among investors (the National Democratic Alliance, or NDA, grabbing around 272 seats in the Lok Sabha) would likely imply higher multiples, though sustainability would depend on actual delivery in policymaking hopes,” the analysts said.

All the 30 Sensex stocks on BSE were trading in the green, with Oil and Natural Gas Corp. Ltd (ONGC), Bharat Heavy Electricals Ltd (Bhel) and NTPC Ltd being the top gainers.

NTPC shares gained 5.11% to Rs.127.5, ONGC gained 4.53% to Rs.345.65, while Bhel gained 2.85% to Rs.204.10.

Among the Sensex stocks, Maruti Suzuki India Ltd and Hero MotoCorp Ltd hit all-time highs at start of the day’s trading. At 9:16am, Maruti was trading up 0.62% at Rs.2,080, while Hero was up 0.89% to Rs.2,324.95 per share.

The oil and gas and power indices were the top sectoral gainers, up 2.29% and 1.82%, respectively.

Foreign institutional investors (FIIs) have pumped in a net $1 billion in 14 straight sessions ending 9 May, latest data from the Securities and Exchange Board of India (Sebi) showed.

Among stock-specific gainers, Mangalore Chemicals and Fertilizers Ltd gained 3.4% to Rs.72.85 after Zuari Fertilisers and Chemicals Ltd made a counter open offer of Rs.68.55 per share.

Shares in Bharti Airtel Ltd gained 1.05% to Rs.321 after the telecom company raised $1 billion in dollar bonds and €750 million through euro

raj kishore sharma

pgdm 2nd sem