Nifty, Sensex Hit New Records As Adani, PSU Stocks Lead: Midday Market Update

Indian equity gauges maintained their gains through the day to mid-day following a record opening on Monday as exit polls showed return of the incumbent government for a third term, indicating policy continuity.

As of 11:55 a.m., the S&P BSE Sensex was 2,295 points, or 3.1%, up at 76.256, while the NSE Nifty 50 was 683.2 points or 3.3% higher at 23,213. Intraday, Nifty surged as much as 2.59% to a fresh high of 23,338.7, while Sensex rose 3.76% to a new high of 76,738.8.

During the session, the Nifty companies added over Rs 5 lakh crore in investors wealth.

The stock volatility gauge, India VIX, — which rose over 80% since phase 1 — fell over 22% during the session. On Saturday, as the Lok Sabha elections concluded, exit polls indicated a clear victory for the National Democratic Alliance.

On the currency front, the rupee strengthened 47 paise to open at Rs 82.99 against the US dollar on strong macroeconomic data. The Indian economy logged a 7.8% growth in the January-March quarter. For the full year, the gross domestic product is estimated to have grown by 8.2%.

Fundamentals, technicals and sentiments turning favourable at the same time is rare in the market, according to VK Vijayakumar, chief investment strategist at Geojit Financial Services. "This is what has happened now."

The market went into the elections very light, with the Nifty correcting around 600 points from the May highs. Profit-booking also happened on a large scale and the short position in the market also is high, Vijayakumar said. "All these are going to change dramatically. Domestic institutional investors, high net-worth individuals and retail participants are all going to turn buyers. Short covering can add to the momentum."

"There have been situations where bulls were slaughtered and taken to the cleaners in 2008 and 2009. This time around, a similar fate could await the bears," according to Vikram Kasat, head of advisory at Prabhudas Lilladher. The month of June could be a defining one for the bulls, so one should make the most of this opportunity and stay a bit greedy, he said.

Meanwhile, the combined market capitalisation of Adani Group stocks surpassed Rs 19.1 lakh crore during the session, driven by a rise in all its stocks, with Adani Power Ltd. and Adani Ports and Special Economic Zone Ltd. leading the gains.

Shares of Reliance Industries Ltd., ICICI Bank Ltd., Larsen & Toubro Ltd. State Bank of India and HDFC Bank Ltd. contributed the most to the gains in the Nifty.

All sectoral indices rose on the NSE advanced, with the Nifty PSU Bank, Energy and Oil & Gas jumping over 5%.

The broader indices also rose as the BSE MidCap rose 3.29% and the SmallCap was trading 1.88% higher. All the 20 sectoral indices on the BSE rose.

The market breadth was skewed in the favour of the buyers as 2,509 stocks gained, 1,307 fell and 168 remained unchanged on the BSE.

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