After the Lok Sabha exit polls predicted a landslide victory for the BJP and a day before the counting and announcement of the results, the stock market surged by over 3% on Monday.
Both the indices hit their fresh record highs, jumping almost 4%, and ended at their fresh closing highs with gains of over 3% each.
Investors’ wealth jumped Rs 12.48 trillion in morning trade on Monday.
Sensex opened at 76,583.29, 2,622 points higher against its previous close, and surged 2,778, or 3.8%, to hit its fresh record high of 76,738.89.
It finally closed with a hefty gain of 2,507 points, or 3.39%, at 76,468.78.
On the other hand, Nifty 50 opened 807 points higher at 23,337.90, and rose 808 points, or 3.6%, to hit its fresh record high of 23,338.70 in early deals.
The index closed at 23,263.90, up 733 points, or 3.25%.
Among the sectors, all ended with gains. Nifty PSU Bank index surged 8.40%, followed by Nifty Oil & Gas by 6.81% and Nifty Realty by 5.95%.
Nifty Bank surged 4.07% while the Financial Services and Private Bank indexes jumped 4.04% and 3.34%, respectively.
The mid-cap and small-cap indices also reached fresh record highs during the session.
BSE Midcap index hit its fresh all-time high of 44560.97 during the session and closed 3.54% higher at 44,367.67.
The BSE Smallcap index hit its fresh record high of 48,973.96 during the session and finally settled with a gain of 2.05% at 48,232.30.
Further, the volatility index India VIX crashed 15% to come back to the level of 20.94.
On the Nifty 50, the gainers were Adani Ports (10.62%), SBI (9.48%), NTPC (9.33%), Power Grid (9.03%) and ONGC (7.43%).
However, the losers were Eicher Motors (1.34%), LTIMindtree (1.12%), HCL Tech (0.57%), Sun Pharma (0.32%), Asian Paints (0.22%), Britannia (0.19%) and Dr Reddy’s Labs (0.03%).
Ahead of the election results, the PSU indices too jumped to fresh highs.
The Nifty PSE index climbed over 5% to a record high, with HPCL, Power Grid, REC, and PFC each rallying over 6% in early morning trade.
The Nifty PSU Bank index raced ahead of both the private bank and Bank Nifty indices, rising 4.5% to a fresh record in early morning trade. Bank of Baroda, SBI, and Indian Bank were the top gainers in the public bank index.
The railway stocks also surged by over 13%. Rail Vikas Nigam Limited (RVNL) saw an increase of 11%, while the Indian Railway Finance Corporation (IRFC) surged by 12.5%.
Other railway stocks that saw gains included IRCON International (6.26%), RITES (3.52%), Indian Railway Catering and Tourism Corporation (IRCTC) by 3%, and Texmaco Rail & Engineering by 5.28%.
Kotak Institutional Equities has also released its latest note saying that it finds little value in the Indian market, seeing most sectors and stocks as overvalued relative to fair value. This overvaluation increases inversely with market capitalisation, quality, and risk.