Mumbai | Benchmark equity indices Sensex and Nifty made a strong comeback on Wednesday, rallying over 3 per cent each after facing heavy drubbing in the previous trade on below-expectation poll results.
Bouncing back from Tuesday's debacle, the 30-share BSE Sensex jumped 2,303.19 points or 3.20 per cent to settle at 74,382.24 on value buying in banking, auto and oil shares. During the day, it zoomed 2,455.77 points or 3.40 per cent to 74,534.82.
The NSE Nifty climbed 735.85 points or 3.36 per cent to 22,620.35. During the day, the benchmark soared 785.9 points or 3.59 per cent to 22,670.40.
Heavy buying in HDFC Bank, ICICI Bank and Reliance Industries helped indices log sharp gains.
While the NDA is comfortably above the majority mark of 272 in the 543-member Lok Sabha, the BJP has fallen short of the magic number for the first time since 2014 and is critically dependent on its allies for government formation.
The Election Commission has declared results for all 543 Lok Sabha constituencies, with the BJP winning 240 seats and the Congress 99.
"Indian market exhibited a spirited recovery driven by broad-based buying across various sectors, as political stability appears assured. However, attention will remain on the formation of the government and the forthcoming RBI policy meeting," said Vinod Nair, Head of Research, Geojit Financial Services.
All the 30 Sensex companies ended in the green, with IndusInd Bank jumping over 7 per cent. Tata Steel, Mahindra & Mahindra, Bajaj Finance, Kotak Mahindra Bank, Hindustan Unilever, HDFC Bank, Axis Bank and JSW Steel also emerged as big gainers.
"Despite the reduced majority, we expect the policy agenda of Modi 2.0 (investment-led growth, capex, infrastructure creation, manufacturing, etc.) to continue, although with some tweaks.
"We also expect some populist measures to address rural stress and lift sentiments at the margin, given the nature of the verdict," a report by Motilal Oswal Research stated.
In Asian markets, Seoul settled with gains while Tokyo, Shanghai and Hong Kong ended lower.
European markets were trading in the green. US markets ended in positive territory on Tuesday.
Global oil benchmark Brent crude climbed 0.14 per cent to USD 77.61 a barrel.
Foreign Institutional Investors (FIIs) offloaded equities worth Rs 12,436.22 crore on Tuesday, according to exchange data..
Markets had the worst trading day in four years on Tuesday as the BJP fell short of the magic number for the first time since 2014.
The BSE benchmark Sensex nosedived 4,389.73 points or 5.74 per cent to settle at a more than two-month low of 72,079.05 on Tuesday. During the day, the barometer tanked 6,234.35 points or 8.15 per cent to hit a nearly five-month low level of 70,234.43.
The NSE Nifty tumbled 1,982.45 points or 8.52 per cent to 21,281.45 during the day. Later, it ended at 21,884.50, a sharp decline of 1,379.40 points or 5.93 per cent.