Markets are cheering early trends for the 2019 Lok Sabha election results, which show NDA leading in over 300 seats. As of 10 45am, Sensex went up 2.98%, touching an all-time high of 40,119.79. Nifty was up by 2.51%, also touching an all-time high of 12,032.50.
Both the Sensex and Nifty opened in the green with Sensex being up 1.38% at 39649.26 and Nifty up 1.33% at 11893.90 at 9.18am.
Even in the pre-opening session, Sensex and Nifty touched record highs as early trends began to show NDA in the lead.
The upward trend continued with the Sensex going up 754.77 points (1.93%) to 39,864.98 as of 10 15 am.
At the same time, Nifty was up 220.75 points (1.88%) touching record highs of 11,958.65 at 10 15am.
As of 10 50am, the NDA is leading in 340 seats with BJP ahead in 285 seats as per CNN-IBN results. UPA was ahead in 89 seats with Congress getting 54 and others being at 113.
The markets, which saw some downward trend over uncertainty due to elections, shot up to record highs on Monday after exit polls gave a majority to the incumbent NDA government.
On Monday, the equity indices witnessed their biggest intra-day gain since September 10, 2013, while on Tuesday, S&P BSE Sensex touched the 39,500 level for the first time.
Experts had predicted a sharp upward movement if NDA led. However, analysts have predicted a huge correction, probably of a higher magnitude than the one seen on Monday, when the euphoria of exit polls showing Prime Minister Narendra Modi’s return gripped the markets.
Alok Churiwala, MD of Churiwala securities told TNM in an earlier interaction that the general elections are always a big event for capital markets because it defines the next five years and what kind of economic policies there will be.
NDA coming back for a second term will mean a stable government at the Centre with a ‘strong leader’ and continuation of policies as well. This is something Foreign Institutional Investors (FII) have also been cheering.
However, once the NDA government comes back to power, experts say that its first focus should be on kickstarting the economy. The government will have to, on an immediate basis, tackle the slowdown in the economy, the agrarian crisis and improve consumption.
Ahead of the results, Amit Gupta, Co-Founder and CEO, TradingBells, claimed that Nifty will cross 12,000 if the NDA manages to secure a majority. "However if this doesn't happen and there is a hung Parliament, or UPA comes to power, we can expect to see a huge correction in the markets over the next couple of days,” he added.