Markets lose steam after Modi wave lifts indices to records

Mumbai: The BSE Sensex surged over 1,000 points Thursday to touch the 40,000-mark for the first time ever following the BJP's thumping electoral show, but could not sustain the euphoria as investors chose to cash in on the gains.

In similar movement, the broader NSE Nifty crossed the historic 12,000-level after early trends gave the BJP a comfortable majority in the Lok Sabha, but succumbed to profit booking towards the fag-end of the session. The 30-share Sensex tumbled 298.82 points, or 0.76 per cent, to close at 38,811.39, while the Nifty settled 80.85 points, or 0.69 per cent, lower at 11,657.05. Interestingly, when the Narendra Modi government came to power on May 16, 2014, the Sensex had rallied 261.14 points, or 0.90 per cent, to 24,121.74; and the Nifty jumped 79.85 points, or 1.12 per cent, to 7,203. According to experts, the markets had already priced in the election outcome and the focus would now shift to reforms, economic growth, monsoon and developments surrounding the bruising US-China trade conflict.

"The re-election of NDA alliance has put to an end to the uncertainty and raised hopes of momentum gaining in the Indian economy and markets, which logically attained new heights today.

"The results have raised hopes of the issues being faced by the economy being tackled in a firm and prudent way. This is the first time in world history that a government that has introduced GST in a country has been voted back to power," said Dhiraj Relli, MD and CEO, HDFC Securities.

IndusInd Bank was the biggest gainer in the Sensex pack, rallying 5.23 per cent, followed by Hero MotoCorp, Coal India, Yes Bank, PowerGrid, ICICI Bank, HCL Tech, L&T, Kotak Bank and Bharti Airtel, rising up to 1.56 per cent.