Markets eye records as exit polls point to third term of Modi-led NDA

Indian stock futures jumped early and the rupee rose as exit polls pointed to a third term and sizable mandate for Prime Minister Narendra Modi

Indian stock futures jumped early on June 3 and the rupee rose as exit polls pointed to a third term and sizable mandate for Prime Minister Narendra Modi, whom investors hope will spend on infrastructure and manufacturing to keep economic growth going.

NIFTY 50 index futures were up about 2.7% in early trade and, at 23,350, indicated the index could touch new peaks when the cash market opens. Non-deliverable rupee forwards traded at 83.11 to the dollar, against a close of 83.46 in the spot foreign exchange market on Friday.

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Weekend exit polls projected the alliance led by PM Modi's Bharatiya Janata Party (BJP) to increase its 303 seats in the 543-member lower house.

A win had been widely expected but, if confirmed in official results due on Tuesday, the margin will be larger than analyst forecasts and seen as a positive for equity markets that have scaled record highs on the back of economic growth.

"We had always felt that the economic progress made by most Indians over the last 10 years was sufficient to see Modi re-elected with ease," said Rob Brewis at UK-based Aubrey Capital Management.

"If this result is confirmed then I think it is a real vote of confidence and Modi can really press ahead now. So maybe that faster growth we need can be attained. The markets should like that."