Sensex soars over 2,300 points, Nifty crosses 22,600 Mark as PM Modi prepares for third term

Indian stock markets witnessed a robust rebound on Wednesday, buoyed by news of Prime Minister Narendra Modi's National Democratic Alliance (NDA) poised to return to power for a historic third term. After enduring its worst session in over four years, the Sensex surged by as much as 2,455 points, while the Nifty 50 index reclaimed the crucial psychological level of 22,600.

By the session's close, the Sensex had climbed 2,303 points, marking a substantial 3.2 per cent increase to reach 74,382. Similarly, the Nifty 50 index soared by 736 points, a significant 3.36 per cent rise, closing at 22,620.

NDA leaders converged in New Delhi to deliberate on government formation under the leadership of PM Modi, with the swearing-in ceremony for the third NDA government anticipated to take place on June 8.

Amid the political developments, the NDA's major ally, the Telugu Desam Party (TDP), reiterated its unwavering support for PM Modi and his party. "We remain committed to the NDA. I will be attending today's meeting in Delhi," stated Chandrababu Naidu, the leader of TDP, addressing reporters.

With the NDA securing 293 seats in the 543-member lower house of parliament, well above the 272-seat threshold for government formation, the alliance's position appears formidable.

The market rally was broad-based, with buying activity observed across sectors. The major sector gauges compiled by the National Stock Exchange all traded higher, led by a 4.8 per cent gain in the Nifty Private Bank index. Additionally, indices such as Nifty Bank, Auto, Financial Services, FMCG, Metal, Pharma, and Healthcare also witnessed increases ranging from 3.5 per cent to 4.5 per cent.

Mid- and small-cap shares also attracted buying interest, with the Nifty Midcap 100 index rising by 4.12 per cent and the Nifty Smallcap 100 index advancing by 3.85 per cent.

IndusInd Bank emerged as the top gainer on the Nifty, with its stock surging by 7.3 per cent to Rs 1,492. Other notable gainers included Mahindra & Mahindra, Shriram Finance, Hero MotoCorp, Adani Ports, Tata Steel, Bajaj Finance, ONGC, Hindalco, Divi's Labs, and Kotak Mahindra Bank, all rising between 4 per cent and 6 per cent.

On the contrary, Bharat Petroleum and Larsen & Toubro were the only losers in the Nifty 50 basket of shares.

The overall market breadth remained highly positive, with 2,454 shares advancing compared to 1,294 declining on the BSE.