Mumbai: Indian stocks rallied, sending the benchmark index to a record, and the rupee touched a nine-month high amid speculation exit-poll results may show a victory by the main opposition party led by Narendra Modi.
Coal India, the world's biggest producer of the fuel, was the best performer on the S&P BSE Sensex. State Bank of India jumped 3.2 per cent, sending a gauge of 12 lenders to a record. Reliance Industries, owner of the world's largest oil-refining complex, rose to a three-year high.
Sensex jumps 2.4%
The Sensex jumped 2.4 per cent to 23,551 at the 3:30pm close in Mumbai. Elections that began April 7 drew to an end yesterday, with the final round of polling in 41 constituencies. The rally may extend if the Bharatiya Janata Party-led alliance wins more than 266 seats, approaching the 272 seats needed for a majority, according to a Bloomberg survey of 19 brokers and investment advisory firms. Votes will be counted on May 16.
"The market seems to have made up its mind that a Modi-led government will come to power," Aneesh Srivastava, chief investment officer with IDBI Federal Life Insurance, said by phone from Mumbai.
"There's an expectation that a change in government will improve economic fundamentals."
The Sensex has risen 19 per cent since September 13, when the BJP named Modi as its candidate for prime minister. Rakesh Arora, head of research at Macquarie Group in Mumbai and the most accurate forecaster for the Sensex in 2013, said in a Bloomberg News survey last month his year-end Sensex target of 23,900, or 1.5 per cent above yesterday's close, may "prove conservative" if Modi comes to power. Global investors have bought more than $10 billion of local stocks and bonds in 2014.
Coal India climbed 7.3 per cent, the most in three years, to Rs331.05. Reliance added 3.1 per cent and Oil & Natural Gas Corp., the largest state-owned explorer, rose 3.1 per cent. Natural gas-supplier Gail India gained the most since March 24. The S&P BSE Oil & Gas Index rose to a three-year high, the best performer among the 13 sectoral indexes compiled by the BSE.
The CNX Nifty Index on the National Stock Exchange surged 2.3 per cent to a record 7,014.25.