Indian stock-index futures climbed after benchmark gauges retreated from record highs yesterday.

SGX CNX Nifty Index futures for May delivery rose 0.4 percent to 7,309 at 10:13 a.m. in Singapore. The underlying CNX Nifty Index on the National Stock Exchange of India Ltd. fell 0.3 percent to 7,252.90 yesterday. The S&P BSE Sensex (SENSEX) declined 0.3 percent to 24,298.02. The Bank of New York Mellon India ADR Index of U.S.-traded shares gained 0.6 percent to 1,302.02.

The Sensex has jumped 23 percent since the Bharatiya Janata Party named Narendra Modi as its candidate for prime minister on Sept. 13, a rally that sent valuations to the most expensive in three years. Modi will be sworn in on May 26 after the BJP and its allies won the first parliamentary majority in 30 years.

“We are quite optimistic on the markets. We expect some consolidation after the sharp move on optimism over a stable government,” Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd., said in a phone interview. “The markets will trade in a narrow band till there is clarity on cabinet formation, direction of government policies.”

The MSCI Asia Pacific Index climbed 0.9 percent today after a Chinese manufacturing gauge rose to a five-month high in May, suggesting that the economy is stabilizing.

Modi’s BJP and its allies won about 61 percent of seats in parliament as voters punished the Congress party-led coalition for slowing growth, graft and Asia’s second-fastest inflation. If Modi pursues the anti-corruption policies he’s promised, India has the potential to grow about 10 percent annually for the next 20 years, according to Jim O’Neill, former chairman of Goldman Sachs Asset Management.

Overseas investors bought a net $ 2.4 million of Indian shares on May 20, according to data compiled by Bloomberg. That took this year’s inflows to $ 7.65 billion, the most among eight Asian markets tracked by Bloomberg.

The Sensex has climbed 14.8 percent this year and is valued at 15 times projected 12-month earnings. The MSCI Emerging Markets Index trades at 10.7 times.

To contact the reporter on this story: Santanu Chakraborty in Mumbai at

To contact the editors responsible for this story: Michael Patterson at Chan Tien Hin, Matthew Oakley