World
Indian stocks surge to record high on Modi poised for victory
Publish Date: May 16, 2014
Indian stocks surge to record high on Modi poised for victory
Virendra Sharma, a polling agent for Indian political party Bahujan Samaj Party (BSP), notes the votes for different candidates as they are released by election officials at a counting centre in Ghaziabad. PHOTO/AFP
  • mail
  • img
newvision

MUMBAI - India's stock market jumped more than six percent to a record high of 25,000 points on Friday as business-friendly opposition leader Narendra Modi looked set for a landslide victory in national elections.

The benchmark Bombay Stock Exchange index, known as the Sensex, rose 6.06 percent to 25,353.16 in morning trade as vote counting showed Modi and his right-wing party would vault to power.

"Markets are following indications that the Bharatiya Janata Party (BJP) and its allies will have a thumping victory. This is crucial for their ability to push key reforms," said Harendra Kumar, head of brokerage Elara Capital.

Banks were leading the gainers, with Canara Bank surging 21.57 percent to 406.60 rupees, followed by Andhra Bank, which jumped 16.17 percent to 83.35 rupees.

The rupee also surged 1.14 percent to 58.52 against the dollar from its previous close of 59.29.

The currency has been strengthening in recent weeks on expectations that Modi would win the marathon six-week election and introduce structural reforms to turn the economy around.

It has now risen 17.45 percent since it sank to a record low of 68.85 in August with investors fretting about a fiscal deficit crisis and waning confidence as the government struggled to boost growth in the face of global economic turmoil.

Markets have risen 5.0 percent in the past week as heady -- many say unrealistic -- optimism has returned after low business investment and economic growth, rising food prices and corruption.

India's central bank said it has contingency plans ready to deal with any excessive volatility in the markets from the election results.

Reserve Bank of India (RBI) governor Raghuram Rajan said it has discussed plans with the finance ministry and the stock market regulator.

"We are ready for any fallout with the change of the government. We are also ready for any volatility in the markets," Rajan said after the RBI's board meeting on Thursday.

Modi looked set on Friday to sweep to victory in the national polls, riding a wave of public support for his message of jobs, development and revival of an economy that is growing at a decade low.

Modi's BJP is heading for its best ever result in the parliamentary vote after 10 years of rule by the leftist Congress party and the Gandhi political dynasty.

Vote counting started at 8:00 am (0230 GMT).

AFP

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
Powerful 7.8 quake shakes Japan
A 7.8-magnitude earthquake struck off the Japanese coast Saturday, geologists said, shaking buildings in Tokyo and setting off car alarms...
Term limits unlikely on agenda at Burundi crisis summit
EAST African leaders meet in Tanzania on Sunday for a summit on the political crisis in Burundi...
Buhari sworn in as Nigeria president after historic win
Muhammadu Buhari was sworn in as Nigeria''s new head of state on Friday in a ceremony mixing military pomp with cultural tradition after he won the first opposition victory over a sitting president in the nation''s history....
Crying baby gets singer kicked off plane
A Canadian singer-songwriter was kicked off a United Airlines flight in San Francisco because her two-year-old toddler would not stop crying....
Madagascar leader to fight impeachment
MADAGASCAN President Hery Rajaonarimampianina has challenged the legality of a parliamentary vote to dismiss him and said the country needed stability...
Catholic Church says withdrawing support for Burundi elections
Burundi's influential Catholic Church said Thursday it was withdrawing support for upcoming elections in the crisis-hit country, dealing a fresh blow to President Pierre Nkurunziza's controversial bid to run for a third term....
Should medical students be subjected to pre-admission exams?
Yes
No
Can't Say
follow us
subscribe to our news letter