Dalal Street on Wednesday witnessed euphoric buying as hopes that the ruling National Democratic Alliance (NDA) coalition would return back to power lifted the spirits of bulls after the first phase of election concluded on Tuesday. Thanks to all-round buying in stocks, the 30-share BSE Sensitive Index (Sensex) ended with a solid gain of 71.61 points, or 1.23pc, at 5,876.42. The broader NSE S & P CNX Nifty Index gained 29.10 points to end at 1,873.35. The benchmark index had gained 4 points in a lacklustre trade on Tuesday. “The comeback of the NDA government will boost the markets,” said a BSE dealer. The exit polls conducted by major television networks placed the ruling National Democratic Alliance (NDA) ahead of the Congress and allies in the 140 constituencies that went to polls in the first phase of the Lok Sabha elections. Said Venkat Aiyar, a BSE dealer, “Investors, already comfortable with the ongoing reforms-oriented policies, made fresh purchases on hopes of a stable government at the Centre. After early weakness, the market traded firm for the most part of the session on sustained buying.” According to Motilal Oswal of Motilal Oswal Securities, the markets would gain momentum after the elections. Analysts say economic fundamentals are still strong and economic growth is picking up. If the NDA comes back, markets expect the government to continue the reforms process vigorously. Furthermore, corporate results for the year 2003-04 are encouraging. Tech companies have come out with good profits and bonus issues. “As the economy has just completed a very satisfying year and is poised for further growth, the new government will not be facing any immediate pressures on the economic front. However, expectations have been built up for taking the reform process to the next stage,” said PGR Prasad, Managing Director, SBI Funds Management. On Wednesday, while frontline stocks rose, stock-specific action was evident in a number of mid-cap side counters. Cipla (up 4.80% to Rs 1,310.10) firmed up - rising from an intra-day low of Rs 1,240 - on fresh buying at lower levels. Power sector pivotals Reliance Energy (up 4.32% to Rs 783.89) and Tata Power (up 2.19% to Rs 409.75) gained ground on fresh buying interest after recent weakness. Tata Motors (up 4.17% to Rs 512.35) gained ground - rising from the day’s low of Rs 490 - on sustained buying interest on hopes of improved quarterly results. Tata Steel (up 3.60% to Rs 412.80) firmed up - rising from an intra-day low of Rs 397.70 - on fresh buying at lower levels amid rumours that the company may consider a bonus issue with its 2003-04 results. Tech stocks opened weak following tech-led weakness in the US markets on Tuesday.
