Key equity indices have largely erased the gains logged on Tuesday morning, when expectations of a BJP victory in the Karnataka assembly election boosted investor sentiment.
The NSE Nifty was trading 0.02% higher to 10,808.60 points at 02:54 pm, while the BSE Sensex was trading 0.05% higher to 35,574.03 points, after news that the rival Congress party is ready to support a JD(S) government in the southern state.
Leads coming in from Karnataka showed that the Bharatiya Janata Party (BJP) was leading in 104 out of the 222 seats that went to the polls last Saturday.
Earlier in the afternoon, the key Indian equity indices were trading around half-a-per cent higher. According to market observers, heavy buying was witnessed in banking, metal and IT stocks.
At 1.10 p.m., the wider 50-scrip NSE Nifty was trading at 10,853.80 points -- up 47.20 points or 0.44 per cent -- from the previous close of 10,806.50 points. The BSE Sensex, which opened at 35,537.85 points, was trading at 35,687.76 points (1.12 p.m.), higher by 131.05 points or 0.37 per cent from the previous day's close at 35,556.71 points.
Experts largely believe that a finally tally that leaves the BJP just short of the majority mark is good for the market. Earlier in the day, market veteran Porinju Veliyath hinted that he expects a BJP victory to provide a big boost for the market, providing opportunities for small and midcaps to bounceback.
#Karnataka - definitely a boost to market sentiment. After 4 months of significant underperformance, 'deserving' mid and small-caps are likely to bounce back strongly!
— Porinju Veliyath (@porinju) May 15, 2018
The Sensex soared over 436 points in late morning deals on Tuesday, while the broader Nifty crossed the 10,900-mark, after the BJP looked on course to emerge as the single largest party in Karnataka.
With inputs from IANS
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Updated Date: May 15, 2018 15:41 PM