Lok Sabha poll result 2024: Will Sensex, Nifty hit another life-high on counting day today?

Cheer, joy and excitement are witnessed among investors after the exit polls predicted a historic third term for Prime Minister Narendra Modi.

The Indian benchmark indices – BSE Sensex and Nifty50 – logged their biggest single-day rally ahead of the Lok Sabha election 2024 results since 2009.

The Lok Sabha poll 2024 results will be declared on Tuesday (June 4). On the eve, the 30-stock Sensex surged 2,507 points, or 3.4 per cent, to end the day’s trade at 76,469, while the Nifty50 jumped 733 points, or 3.25 per cent, to close at 23,264.

During the day’s (June 3) trade, both BSE Sensex and Nifty50 hit their respective record highs of 76,739 and 23,338, respectively.

The last time…

The last time when the Indian benchmark indices – BSE Sensex and Nifty50 – logged their biggest single-day rally ahead of general election results was in 2009. They jumped about 2.46 per cent.

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Nifty Bank breaches 51,000-mark

Nifty Bank too, for the first time in history, surged past 51,000-mark.

The bank index rallied nearly 2,000 points or over 4 per cent on Monday, tracking exit polls predication that indicate political stability.

A stronger rupee

Firm investors’ sentiments after exit polls prediction have also driven the Indian rupee (INR) to its strongest intraday performance since December 2023 on June 3.

The INR closed at 83.1425 against the US dollar. It surged nearly 0.4 per cent, marking its best intraday gain in over five months.

Initially in the day, the rupee peaked at 82.9575, however, it trimmed gains amid importer hedging and bids from state-run banks as it strengthened.

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What have exit polls predicted?

Most exit polls have predicted a return of the Narendra Modi-led NDA government, winning over 350 seats, with the Opposition’s INDI Alliance managing somewhere between 125 and 150.

News18 conducted its own mega exit poll, according to which NDA is seen winning on 355-370 seats, while the INDI Alliance bagging 125-140 seats.

Can they be relied on?

In the previous two Lok Sabha polls, in 2014 and 2019, the exit polls had correctly read the mood of the nation in favour of Narendra Modi.

In 2019, the BJP had won 282 of the 543 seats, which improved five years later in 2019 with the party bagging victory on 303 seats.

How Sensex, Nifty will trade on LS poll results 2024 day?

With limited hours left for the counting of votes and announcement of Lok Sabha poll 2024 result, Firstpost spoke to analysts whom see the upward trend in the Indian share market to continue on June 4.

“The stock market is expected to rally significantly on the result day and in the week following that,” Akshat Garg, CFA, Senior Manager, Choice Wealth said, adding that the market is favouring the win of PM Modi’s BJP government.

“Exit polls results which indicate clear victory for the NDA with around 360 seats completely removes the so called election jitters which have been weighing on markets in May,” VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said.

“The market has surged to record highs following the exit poll results, reflecting investor optimism and confidence in the anticipated political stability… The sentiment is likely to remain bullish, with increased buying activity pushing indices higher,” Nikunj Saraf, Vice President, Choice Wealth, said.

“The trend will likely depend on the official election results and subsequent political developments. We can expect the bullish trend to continue if the actual results align with the exit polls. However, any surprises or deviations from the exit poll predictions could introduce volatility and lead to a more cautious market approach,” Saraf said.

Which stocks will see a rally on poll result day?

“Largecaps in financials, capital goods, automobiles and telecom are likely to lead the rally. The bulls will be further emboldened by the better-than-expected 8.2 per cent growth in GDP numbers which came after market hours on Friday. Technically and fundamentally the market is poised for a rally,” Vijayakumar said.

Garg, meanwhile, said if the BJP secures a victory, certain sectors and stocks are anticipated to benefit significantly due to the party’s policies and economic agenda.

“Public Sector Undertakings (PSUs) such as REC, PFC, NTPC, NHPC, Coal India, and HUDCO are expected to thrive with continued government support and investment. The power sector, including REC, PFC, NTPC, and NHPC, will likely benefit from the BJP’s focus on infrastructure development and energy security,” Gard said.

“Defence companies like HAL, BEL, Bharat Dynamics, and Cochin Shipyard are set to gain from the party’s emphasis on defence modernisation and self-reliance. New age commerce companies such as Zomato, Nykaa, PB Fintech, and Mama Earth are poised to grow with the push for a digital economy,” Garg further said.

“Sectors aligned with BJP’s policy priorities—PSUs, power, defence, new age commerce, and manufacturing—are expected to see enhanced performance, offering potential investment opportunities,” he said

Meanwhile, Saraf said: “Key sectors to watch include banking, infrastructure, and consumer goods, PSU, which typically benefit from political stability and economic growth expectations.”

Sensex, Nifty to see another record high

Garg further went on to say that a “fresh record high” is anticipated for both Sensex and Nifty50 in the short-term following the election results, driven by the formation of a stable government providing market stability.

How about FIIs?

“Domestic Institutional Investors (DIIs) are expected to maintain their bullish stance, while Foreign Institutional Investors (FIIs) are likely to increase their investments in India due to the country being a favourable option in the emerging markets amidst uncertainties in China’s economy and market,” Garg concluded.