Energy giant Reliance Industries rose more than 20 percent, increasing its market capitalisation by about $13 billion to about $75 billion, on low volume of 41,096 shares.Leading private-sector bank ICICI Bank rose by more than a quarter and infrastructure play Larsen & Toubro put on nearly 30 percent.
Analysts expect a strong Congress-led coalition may look at privatisations and push ahead with reforms of sectors such as banking and insurance."Clients want to buy.
They have nothing else to say," said R. Sriram, a technical analyst at ICICI Securities."There are still a lot of short positions pending. Investors will bang their boots and come into cover them.
There could be another circuit breaker," he said.The 30-share BSE index jumped 17.34 percent, or 2,110.79 points to 14,284.21 points, its best close since Sept. 11 last year. The index has now leapt 77.5 percent from a 2009 low in early March.Volumes were extremely low, with just 13.3 million shares traded compared with 405.3 million shares on Friday.All components on the main index rose, and in the broader market, gainers overwhelmed losers 834 to 11.
The 50-share NSE index rose 17.7 percent to 4,323.15 points, and also shut early for the day."Justifiably this an euphoric reaction to the strong mandate and thus the really, really low volumes.
Having said that, tomorrow I believe trading will happen and I suspect it will be up," said Jayesh Shroff, fund manager at SBI Capital Markets."But in the short-term sellers will come in, as ultimately economics will have to come in play," he said.
The market was open for two brief periods, jumping nearly 15 percent in initial deals and setting off a circuit breaker that halted trade for two hours.
The final circuit breaker was set off almost immediately after trading resumed, halting trade for the rest of the day."
The election's positive impact on business confidence is the final tenor in the chorus of evidence arguing for a pickup in activity and investment demand in the second half of the 2010 financial year," said Tushar Poddar, an economist at Goldman Sachs.
Increased interest from foreign funds, which have pumped in about $4 billion into Indian stocks since late March, has lifted the benchmark index 48 percent this year, after it fell more than half in 2008.With reduced political risk, there may be even more interest from foreign funds, brokerage CLSA Asia-Pacific Markets said.
The Indian markets' circuit breakers are set on points moves in the index, calculated using changes of 10 percent, 15 percent and 20 percent based on the close of the previous quarter.
As the market had risen since the end of March, the percentage rises on Monday that took the market to the trigger limits were less than 10, 15 and 20 percent of Friday's close.The 10 and 15 percent limits halt trade temporarily, unless they happen in late trade, while breaching the 20 percent limit closes the markets for the day.
Triggering a circuit breaker in either the Bombay Stock Exchange or National Stock Exchange also closes the other.
