After exit polls predicted a sweeping victory for Indian Prime Minister Modi's party, the Indian stock market soared to record levels on Monday, and the Indian rupee and sovereign bonds also climbed.

India's SENSEX index rose 3.51% to a record high of 76,557.94 points. India's NIFTY index rose 3.6% to 23,337.90 points in pre-market trading. The surge in India's stock market was so intense that its biggest brokerage website and app reportedly crashed. A spokesperson for Zerodha, one of India's largest brokerages in terms of user numbers, said that some users were unable to access the website or mobile app.

Modi's third term will help ensure the continuity of policy, boost India's economy, and attract global investors. Vote counting will take place on June 4.

India's economic growth rate is now among the world's highest. Modi's potential victory, combined with S&P Global Ratings' recent upgrade of India's rating outlook, could trigger a reversal of over $3 billion in global fund withdrawals from India's stock market this year.

Rajesh Bhatia, chief investment officer of ITI Mutual Fund, said: "The market is currently digesting the expectation that the government will continue to implement its economic management policies and guidelines."

Bhatia added, "We expect the government to continue its policy of large-scale capital expenditure, focus on production-related incentives, and further advance the growth cycle. It should also stay away from tax policies that harm capital investment."

Vishnu Varathan, head of economics and strategy for Asia at Mizuho Bank, said that driven by macro, political, and credit-positive factors, the SENSEX index will perform better than the global and most Asian stock markets."

Analysts also pointed out that Monday's rebound in India's stock market benefited from short-covering by foreign investors who were closing their bearish bets. Prior to this, Bloom compiled data showed that net short positions of global funds in India's stock index futures surged to 213,200 contracts, a new high since 2012.

Abhay Agarwal, founder and chief investment officer of Piper Serica Advisors, said, "Foreign investors need to quickly cover their short positions." He added: "If the governing coalition finally wins more than 350 seats, additional margin calls on short positions could drive the market (NIFTY index) to new highs and approach 23,500 points on June 4."

Exit polls have eased investor concerns over a sharp drop in voter turnout in Indian elections that was previously seen as a sign of declining support for the ruling Bharatiya Janata Party.

On Monday, the India VIX Index, a 30-day implied volatility index based on option prices, plummeted 22% and may close at its lowest level in more than three weeks. It has more than doubled from its late-April low.

From a sectoral perspective, utility company stocks led the way, including state-owned power grid companies and India's largest power plant, NTPC Limited. Shares of other state-owned enterprises and infrastructure-related companies have also risen, with the infrastructure index and state-owned enterprise index of the Mumbai Stock Exchange both rising significantly to new highs.

Stocks controlled by companies, including the Adani Group and billionaire Mukesh Ambani, also surged. All ten stocks of Adani Group's power business rose, with the power department's increase reaching 18%. The stock price of Reliance Industries Ltd, India's most valuable company, jumped 4%.

Citigroup and Jefferies believe that if the vote count on June 4 shows results similar to the exit polls, stocks in sectors such as manufacturing and electric vehicles will be the main winners.

At the same time, as investors weighed in on the results of tomorrow's exit polls and the Reserve Bank of India's interest rate decision later this week, India's benchmark 10-year government bond gave back some of its gains during the trading session, with yields falling 4 basis points to 6.94%, the lowest since April 8, 2022, down 4 basis points from the previous close. The rupee rose to 82.9575 against the dollar, the highest level since March 19. The rupee was Asia's second-best-performing currency on Monday.