Indian shares rose on Monday, with the NSE index moving close to breaching a key psychological level of 9,000, on hopes the ruling BJP would win the ongoing elections in UP.
The elections are the world’s largest this year and will have a key influence on Prime Minister Narendra Modi’s chances of clinching a second term in 2019. Election results are due out on Saturday.
Sentiment was also boosted as the country moved a step closer towards launching a long-awaited new national sales tax from July after a panel of central and state finance officials finalised two key bills to be put before parliament.
“The expectation is that the BJP government will come into power in UP, and that is possibly driving the market a little more confident than before,” said Deven Choksey, managing director at K.R. Choksey Shares and Securities.
The broader NSE Nifty was up 0.69% at 8,959.05 by 05:50 GMT, while the benchmark BSE Sensex was 0.74% higher at 29,045.39.
Reliance Industries Ltd was the top gainer, rising 4% to its highest since May 2008. Shares in the energy conglomerate have risen 15% since telecom unit Jio said it would start charging for its services in April.
Financial stocks accounted for nearly half of the gains on the NSE index, with State Bank of India and Axis Bank Ltd leading the rise. Shares of SBI and Axis Bank rose up to 1.5% each.
Coal India Ltd climbed as much as 2% after unit Central Coalfields approved share buyback of up to 10.02 billion rupees ($150.12 million), according to an exchange filing on Saturday.
IT stocks were among the top losers, with Tata Consultancy Services Ltd and Infosys Ltd falling over 1 percent each, amid lack of clarity over processing of H1B visas in the US.