Sensex rises on likely win for BJP in Assam

Mumbai, May 17: Sensex rose on Tuesday, on track for the second straight day of gains, after exit polls showed a likely first-time victory for the Bharatiya Janata Party (BJP) in the key northeastern state of Assam, in a push for its reform agenda.

A win in Assam, a tinderbox of ethnic and religious animosities, would testify to the continuing appeal of the BJP, the ruling party at the centre, in results that are due on Thursday.

The outcome is being closely watched by markets as a potential indicator of the mood of voters in the world’s biggest democracy and gives a snapshot of Prime Minister Narendra Modi’s performance as he approaches the half-way mark of his five-year tenure.

“BJP is likely to consolidate its position in Assam, which is positive for the government, as it will be able to push forward its reform agenda more strongly,” said K.K. Mital, head of portfolio management, Globe Capital Market.

Global market sentiment also improved, with Asian shares recovering from two-month lows on Tuesday, after a rebound in technology giant Apple Corp and oil price gains boosted Wall Street.

Reflecting the optimism, Nifty was up 0.5 percent at 7,900.15 as of 0543 GMT, while Sensex was 0.6 percent higher at 25,806.29.

Blue chips such as Larsen & Toubro Ltd and Housing Development Finance Corp gained nearly 2 percent each.

State-run oil retailers such as Bharat Petroleum Corp and Hindustan Petroleum Corp rose 2 percent each on a hike in retail prices of petrol and diesel.

Sobha Ltd rose 1 percent after the property developer said it would consider a share buyback during a board meeting on Thursday.

Sun TV Network Ltd soared as much as 10.4 percent after exit polls predicted the DMK-Congress alliance will form the next government in the southern state of Tamil Nadu.

Among the decliners, Tata Coffee dropped as much as 2.6 percent after it posted a 13 percent fall in March-quarter consolidated net profit.

Bank of Baroda extended losses after the bank posted on Friday its second quarterly loss due to a surge in provisions.