India markets to cheer likely third term for Modi, hope for reforms

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Bajaj Finance, IT giant Infosys and tech services firm TCS, said Neeraj Dewan, director at brokerage Quantum Securities.Longer-term, stocks related to the investment cycle such as capital goods, infrastructure and commodity firms could benefit, said Vikaas Sachdeva, managing director of investment firm Sundaram Alternates.The benchmark indices, up 4% this year, experienced volatility around two-years highs in May as shadow betting markets suggested the election would be closer than opinion polls had suggested before the seven-stage vote began.Foreign investors sold a net $3 billion in May and stepped up hedging ahead of the election verdict.These investors could return "in a big way" after staying on the sidelines, said Dewan of Quantum Securities.Such inflows will put upward pressure on the rupee, which the central bank has been attempting to curb through market intervention, and will boost bond prices, said Madhavi Arora, economist at Emkay, a Mumbai-based brokerage.If Modi wins the strong victory suggested by the exit polls, he could gain political capital to push through tougher reforms needed to keep the economy of the world's most-populous nation growing robustly.India's economy accelerated to 8.2% growth in the financial year to March 2024 from 7% the previous year, led by government spending on infrastructure and a boom in real estate, data showed on Friday.But private firms have not stepped up spending on setting up fresh capacities and consumption in rural areas has been weak.An expectation of continuity in economic policies could lead to a pick-up in private investment, said Sachdeva of Sundaram Alternates."Post election results we will see lot more news coming in from the private sector, which will lead to a