Indian stocks surge to record high on Modi poised for victory

MUMBAI, May 16, 2014 (AFP) – India’s stock market jumped more than six percent to a record high of 25,000 points on Friday as business-friendly opposition leader Narendra Modi looked set for a landslide victory in national elections. The benchmark Bombay Stock Exchange index, known as the Sensex, rose 6.06 percent to 25,353.16 in morning trade as vote counting showed Modi and his right-wing party would vault to power.

“Markets are following indications that the Bharatiya Janata Party (BJP) and its allies will have a thumping victory. This is crucial for their ability to push key reforms,” said Harendra Kumar, head of brokerage Elara Capital.

Banks were leading the gainers, with Canara Bank surging 21.57 percent to 406.60 rupees, followed by Andhra Bank, which jumped 16.17 percent to 83.35 rupees.

The rupee also surged 1.14 percent to 58.52 against the dollar from its previous close of 59.29.

The currency has been strengthening in recent weeks on expectations that Modi would win the marathon six-week election and introduce structural reforms to turn the economy around.

It has now risen 17.45 percent since it sank to a record low of 68.85 in August with investors fretting about a fiscal deficit crisis and wanin