Hailing to BJP’s landslide victory in Uttar Pradesh, Nifty peaked to new highs, Sensex peaks up by 600 points and value of Rupee strengthens on Tuesday.

The Indian stock market seems to be cheering about BJP’s triumph at Uttar Pradesh. The Nifty closed at the high of 9,087 and Sensex surged 1.7% on Tuesday which implies the trust of investors in Modi Government and that the hike is an endorsement to his economic reformation agenda.

The Sensex rose as much as 615 points to 29,561 while Nifty surged 188 points to record high of 9,122. Foreign institutional investors (FIIs) bought shares worth nearly Rs 4,100 crore on Tuesday. The huge overseas flows saw the rupee climb 1.2 per cent against the dollar to 65.82, the highest level since November 6, 2015.

According to the analysts, the election results have removed the political uncertainty and stabilised the cautious investors with the hope from the government to implement new economic agendas to strengthen the market.

ICICI Bank led the Sensex chart, gaining 6% after CLSA tagged the private lender as its top buys. “This win for BJP would mean bolder and stronger reforms from here. Masses have applauded demonetization, so many such steps may follow,” said Ravi Sundar Muthukrishnan, co-head of research at ICICI Securities Ltd.

However, a Bloomberg report suggests that reform pace may stagnate or reverse if the Modi government interprets the victory in UP as a reward for his demonetisation exercise or his action towards several welfare measures in recent years.