The Sensex surged past 76,000 in early May 27 trading, taking 31 sessions to climb 1,000 points from 75,000 on April 9. This rally from 74,000 to 75,000 took just 21 sessions, while the climb from 73,000 to 74,000 took 37 sessions. The move from 72,000 to 73,000 happened in just 13 sessions.
During this rally, 14 Sensex stocks were positive while the rest were negative. Bharti Airtel led with a 15% increase, adding Rs 1.13 lakh crore in market capitalisation, followed by Mahindra & Mahindra and Power Grid Corp, which added mcap worth Rs 62,000 crore and Rs 54,000 crore, respectively.
Other gainers included SBI, ICICI Bank, and Axis Bank, each adding over Rs 33,000 crore in market cap, while Hindustan Unilever and Tata Steel Ltd contributed nearly Rs 23,000 crore and Rs 12,000 crore respectively.
HCL Tech suffered the most, dropping over 12% and shedding around Rs 52,500 crore in market cap. Tata Consultancy Services Ltd and Titan Co Ltd followed suit, declining by 3% and 8% respectively, losing Rs 44,000 crore and Rs 3,000 crore in market cap. Sun Pharma and L&T lost around Rs 27,000 crore and Rs 24,000 crore respectively. HDFC Bank and Bajaj Finance also saw declines, erasing Rs 21,000 crore each in market cap during this period.
Indian markets have been volatile in 2024 so far due to uncertainty surrounding election results. Market participants believe that lower voter turnout, compared to 2019, may not indicate a change in government. While the incumbent government might fall short of pre-poll expectations, it's expected to improve on its 2019 performance. Reports suggest lower turnout may impact BJP's desired tally of 350-400 seats.
In the last two sessions, Indian markets surged to a new high, with Sensex and Nifty achieving 76,000 and 23,000 milestones, respectively, after RBI's announcement of special dividend of over Rs 2 lakh crore. Investors are eagerly awaiting the GDP numbers for the March quarter, scheduled for release on May 31, as well as exit polls on June 1. The results of Lok Sabha elections 2024 are scheduled to be announced on June 4.
Brokerage UBS predicts BJP retaining a single-party majority, foreseeing policy stability and potential reforms that could uplift Indian markets. However, unexpected outcomes may initially dampen sentiment, causing short-term fluctuations and revisiting pre-NDA equity levels due to political instability and policy uncertainty.
A strong BJP mandate would boost infrastructure spending, benefiting sectors like industrials, capital goods, utilities, defense, cement, and real estate. Conversely, a weaker mandate may prioritise consumption, favouring consumer-led sectors. UBS emphasises that election impact tends to fade over time and sees equity weakness as buying opportunities. They also favor medium- to long-duration bonds, especially if yields rise post-election.
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