The Indian stock market experienced a significant surge in early trading today, driven by optimism over potential political stability following recent exit poll predictions. Investors earned ₹11 lakh crores after early morning trade, as the BSE Sensex soared by nearly 2,500 points, and the NSE Nifty saw its largest opening jump in four years.
Stock Market Hits Record Highs with Strong Gains from Major Financial Stocks
Both the Sensex and Nifty reached record highs today, with major contributors like Reliance Industries Limited, ICICI Bank, and HDFC Bank showing positive movements. Specifically, the Sensex opened at 76,583.29, up by 2,621.98 points or 3.55%, and the Nifty 50 started the day at 23,337.90, an increase of 807.20 points or 3.58%. Additionally, the Bank Nifty index crossed the 50,000 mark for the first time, indicating robust performance in the banking sector.
There was a widespread rally across various stock market segments. The Nifty Smallcap 100 and the Nifty Midcap 100 indexes both ascended nearly 3%. Sectoral indices, including Nifty PSU Bank, Nifty Oil & Gas, Nifty Auto, and Nifty Metals, registered significant gains ranging between 1% and 4%.
This stock market optimism is largely attributed to the aggregate results of 12 exit polls released on Saturday, which forecast a commanding return to power for the BJP-led NDA alliance with an expected total of 365 seats—a comfortable majority, as 272 seats are required to form the government.
Jefferies Sees Positive Outlook for Capex and Large-Cap Stocks
According to Jefferies, if the actual election results align with the exit polls, it will be a positive sentiment booster for capex stocks. The brokerage firm suggests that smallcap and midcap stocks (SMID) might experience a breather after the election results-driven rally, while laggard largecap stocks are well-positioned tactically. The potential return of foreign institutional investors (FII) could favour large-cap stocks, including private banks and Reliance Industries.
From a long-term perspective, Jefferies favours sectors such as Real Estate, Industrials, and Power. Among individual stocks, private financials like HDFC Bank, IndusInd Bank, and Kotak Mahindra Bank are trading at significant discounts. Jefferies also recommends stocks like Eicher Motors, TVS Motor Company, Coal India, ONGC, and select cement stocks such as ACC and Shree Cement.
Jefferies is a global investment banking and capital markets firm which provides a wide range of financial services, like investment banking, advisory, sales and trading, research, and asset management.
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