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Insult from within after poll injury
Markets see what Nitish doesn’t

Patna/Mumbai, Dec. 9: What the markets believe, Nitish Kumar doesn’t.

A Narendra Modi wave, that is.

The sensex and the Nifty leaped to their all-time highs today, underpinned by the market’s belief that the NaMo juggernaut has gained critical pace.

The sensex vaulted to 21,483.74 in morning trade on Monday, buoyed by Sunday’s results in the four Assembly polls that many read as a clear pointer to the outcome of the general election next year.

The rupee also climbed to an almost four-month high of 60.90 against the dollar as local stocks strengthened.

The Bihar chief minister though refused to buy the argument being extended in several circles that it’s the Modi effect that has triggered the BJP surge.

“Since there was no alternative to the Congress other than the BJP in Madhya Pradesh, Rajasthan and Chhattisgarh, it won. But in Delhi, where AAP (Aam Aadmi Party) was a third option, the BJP failed to form the government despite the profound anti-Congress environment,” the chief minister said in Patna, advancing the argument that far from being looked upon as a Modi wave, the results should be seen as a rejection of the Congress.

In the same breath, the chief minister sought to distance himself and his JD(U) from the Congress given the speculation that he was keen on an alliance for the Lok Sabha polls to thwart the BJP.

“We are not in contact with anyone. We have started our Sankalp Rallies on our own,” the chief minister said on the Bihar Assembly premises.

Nitish instead stressed that people wanted to vote for a third alternative and that the “writing on the wall” was there for both the Congress and the BJP to see. “The BJP has benefited where there was a direct fight with the Congress. But the real story is in Delhi. The people found an option in AAP and voted for it,” Nitish said.

But the markets think otherwise. Today’s surge follows that of December 5 when the sensex had surged 249 points after exit polls showed leads for the BJP.

The perceived wisdom in the market was to start buying stocks but with a little care.

“The Assembly elections are viewed by many as a preview of the general elections, which are due by May 2014. However, we would caution that state election outcomes are not always a reliable indicator of general election prospects,” financial services firm Nomura said in a note today.

The 50-share CNX Nifty on the National Stock Exchange rose 104 points, or 1.66 per cent, to 6,363.90, after touching an intra-day peak of 6,415.25. Both indices surpassed their previous highs on November 3.