New Delhi
CNN
—
Indian stock markets hit a record high on Monday after experts predicted a landslide victory for incumbent Prime Minister Narendra Modi in general elections.
India’s main stock index, the Sensex index (tracking the 30 largest companies), and the broader Nifty 50 index both rose more than 3% to close at record highs.
The surge comes as India wrapped up a massive, weeks-long election this weekend.
“I can say with confidence that the people of India have voted in record numbers to re-elect their government,” Prime Minister Modi said. I said it with X Saturday, coming soon After the voting ended.
The 73-year-old The past decade has been a period of strong growth for India’s economic performance.
The results are due to be announced on Tuesday. In India’s last election in 2019, Mr. Modi’s party won 303 seats in parliament. Analysts cited local exit polls predicting a landslide victory for Mr. Modi this time as a key reason for market optimism.
“The market reacted favourably as exit polls showed a result in the 370-seat range, beating market expectations of 320-350 seats,” said Manish Chowdhury, head of research at brokerage Stoxxbox.
“We expect to see increased capital inflows from both domestic and international investors going forward,” he added.
The stock market surge also came after the country reported strong economic growth figures on Friday, with the economy expanding more than 8% in the fiscal year that ended in March, cementing India’s position as the world’s fastest-growing major economy.
The country is well-positioned to achieve annual growth of at least 6 percent over the next few years, but analysts say it needs to grow at 8 percent or more to become an economic powerhouse.
Investors are hopeful that if Modi wins a large majority in parliament, his government will enact major land and labor reforms needed for the next phase of growth.
Sustained growth is expected to propel India up the rankings of the world’s largest economies, with some observers predicting that by 2027, India will be third in size after the United States and China.
Shares in ports-to-power conglomerate Adani Group also soared on Monday, with its flagship unit Adani Enterprises rising more than 7 percent and Adani Power up 16 percent.
Last week, the company’s founder, Gautam Adani, once again became Asia’s richest man, overtaking India’s Reliance Industries Chairman Mukesh Ambani. Bloomberg Billionaires Index.
Both Ambani and Adani are seen as staunch supporters of Modi. Adani’s wealth is growing. It comes a year and a half after US short-seller Hindenburg Research was accused of fraud spanning decades, rocking the group into an unprecedented crisis.
Adani denounced Hindenburg’s report as “baseless” and “malicious.”
Since then, the billionaire has enjoyed a remarkable comeback, with shares in his companies soaring to record highs as investors praised his ability to shrewdly invest in areas identified as Prime Minister Modi’s development priorities.
India’s stock market has performed well during his tenure. The value of companies listed on Indian bourses surpassed $4 trillion at the end of last year, and earlier this year India’s National Stock Exchange (NSE) overtook the Shenzhen Stock Exchange and the Hong Kong Stock Exchange to become the world’s sixth-largest bourse, according to data from the World Federation of Exchanges.
