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Most Indian equities rose ahead of tomorrow’s official outcome of the national elections, with most exit polls predicting the re-election of Prime Minister Narendra Modi.

The S&P BSE Sensex gained 0.2% to 39,064.66 as of 9:41 a.m. in Mumbai, while the NSE Nifty 50 Index gained 0.1% to 11722.65.

The benchmark stock index yesterday retreated after closing at a record on May 20 as exit polls predicted another term of government by Bharatiya Janata Party and its allies, with a comfortable majority. The MSCI gauge of Indian shares trades at almost 18 times its estimated one-year earnings compared with the MSCI Emerging Market Index’s 11.6 times.

Strategist View

  • “I feel markets will remain quiet today ahead of the main event tomorrow,” said Avinash Gorakshakar, head of research at Mumbai-based Joindre Capital Services Ltd.
  • If the Modi-led coalition crosses the 300-seat mark tomorrow, Nifty may touch 12,000, Gorakshakar said. “We will see a mild sell-off if the seat count is 220 to 250, but a massive one if they fall below 200.”

The Numbers

  • Ten of the 19 sector indexes compiled by BSE Ltd. advanced, led by a gauge of property stocks.
  • Nineteen of the 31 Sensex members and 27 of the 50 Nifty companies gained.
  • Refiner Bharat Petroleum Corp. rose the most among Nifty members, adding 1.6%, after a more than 4% fall yesterday.
  • Dewan Housing Finance Corp. slumped 15%, the steepest on S&P BSE 200 and S&P BSE 500 indexes, after a report that the mortgage lender has stopped accepting fresh deposits and has halted the withdrawal of money before the end of tenors.
  • A BSE gauge of mid-sized companies retreated 0.6%, a second straight day of fall.
  • Net incomes at 24 of the 37 Nifty companies that have reported earnings so far have either topped or met the analyst estimates, according to data compiled by Bloomberg. Drug maker Cipla Ltd. Ltd. and IndusInd Bank Ltd. will report their January to March earnings later in the day.
  • The NSE Volatility Index climbed 4.7%, extending its two-day advance to more than 13%.

Analyst Notes/Market-Related Stories

  • Modi Exit Poll Euphoria Fades for Rupee as Challenges Loom Large
  • Modi Win Not Enough for Pictet Asset to Buy More Indian Stocks
  • JPMorgan Sees Value in Some India Bonds if Exit Polls Prove True

To contact the reporter on this story: Ameya Karve in Mumbai at akarve@bloomberg.net

To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Margo Towie, Anto Antony

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