Dalal Street witnessed its best-ever post-election rally in history on Monday with the benchmark index jumping over 2,110 points or 17 per cent on the first trading day after the announcement of the Lok Sabha election results.
The benchmark index Sensex surged a whopping 2,110.79 points and Nifty advanced 651 points immediately after trading resumed following its suspension for two hours, leading to a halt in buying and selling for the day on the country's two premier bourses.
The general elections gave a decisive mandate to the Congress-led United Progressive Alliance, fuelling hopes of a stable government and that reforms may take place with ease.
Marketmen said the surge in the stock markets was expected as the new government would come to power without the support of the Left Parties, easing the process of reforms.
In the general elections in May 2004, the market did not expect the defeat of the BJP-led National Democratic Alliance and the Congress-led coalition had to take the support of the Left parties to form the government.
The election results were announced during the trading hours on May 13 and the Sensex had ended up 0.8 per cent after highly volatile trade, but lost 6.1 per cent the next day.
In the following trading session on May 17, the index plunged as much as 11.1 per cent, its biggest drop in 12 years, on fears of a Left-backed government.
However, the market bounced back 8.3 per cent on May 18 on indications of Manmohan Singh, who helped start the economic reforms in the country, becoming prime minister.
In 1999, the Sensex had gained 5.7 per cent October 7 as the BJP-led coalition won a majority.
According to financial services major Citigroup's research arm, in March 1998 the market had gained 2 per cent after the results, while in 1996 it plunged around 5 per cent after the poll outcome.
Further, in June 1991, the pre- and post-election periods were good for investors and there were no major jitters. In June, the Sensex had seen a marginally one per cent drop that year.
