Sensex surges to 1-mth high on exit polls

Mumbai: Dalal Street traded cautiously on Thursday after exit polls for five state elections showed that the BJP could win more seats than the Congress, a trend that many believe is also an indication of the Lok Sabha poll results that may effect a change of guard at the Centre in mid-2014.      Boosted by foreign fund buying, the sensex surged over 400 points in early trades but, as traders turned cautious, profit-booking set in and it finally settled with a 249-point gain at 20,958 — a one-month closing high. The final results for the five states that went to polls — Delhi, Rajasthan, Madhya Pradesh, Chhattisgarh and Mizoram — will be out on Sunday and could change the course of the market next week, brokers and analysts said.      In the run-up to the state elections, some of the top foreign brokerage houses came out with research reports that almost endorsed Narendra Modi as BJP's prime ministerial candidate and said that Modi as the next PM would be good for the economy. These foreign brokerages include heavyweights like Goldman Sachs and CLSA and they influence the investment decisions of several foreign fund managers.      On Thursday foreign brokerages net-bought stocks worth Rs 1,152 crore, BSE data showed. However, domestic funds remained net sellers at Rs 674 crore.      "There has been a record turnout of voters in the state polls. Now we need to see the percentage of votes BJP gets and if the extra turnout was favouring the party…that should be a strong pointer towards a win for the party in the general elections next year," said Deven Choksey, MD, KR Choksey Shares & Securities.