The Bharatiya Janata Party’s landslide win in Uttar Pradesh on Saturday saw the Nifty hitting new high at 9,122.75 in opening trade. Sensex also soared 616 points to reach 29,561.93. In further cheer for the markets, the rupee also rose 42 paise to 66.18 against the US dollar on increased selling of the US currency by exporters and banks amid higher foreign inflows. On Friday, the rupee had gained 11 paise to close at a fresh 4-month high of 66.60 against the dollar on renewed selling of the US currency by exporters and banks.
The ruling party’s victory in Uttar Pradesh, coupled by a landslide win in Uttarakhand, seem to have removed investors fears about the advance of reforms in the economy. Government functionaries believe that the wins will propel the Centre to push through key reforms.
“The last bastion of caste politics has come around and voted for development. Finally, even Uttar Pradesh wants good governance and growth,” Arvind Panagariya, Vice Chairperson, Niti Aayog told the Indian Express. “I expect continued reforms while ensuring that the poor receive what the Prime Minister promised.”