The markets on Monday shook off any lingering negative implications from the Karnataka elections with the benchmark indices closing at nearly five-month highs as uninterrupted foreign fund inflows dimmed concerns about weak quarterly earnings and an El Nino hit monsoon.

While the BSE Sensex gained 317.81 points or 0.51 per cent to end at 62345.71, the highest closing since December 14, the broader NSE Nifty rose 84.05 points or 0.46 per cent to close at 18398.85 points.

Meanwhile, in the bond markets, yields on the benchmark 10-year security closed at 7 per cent after hitting a 13-month low of 6.97 per cent in intra-day trades. Last Friday, the paper had closed a tad below the 7 per cent mark at 6.99 per cent. The decline in yields or the rally in G-Sec prices was on account of the lower retail inflation number in April.

This positive start to the week came despite a big setback to the ruling BJP last Saturday as the Congress won the Karnataka state elections with a thumping majority.

Markets ignored the Karnataka outcome as brokerages maintained the BJP is unlikely to suffer a defeat in the 2024 general elections.

Foreign portfolio inflows also helped to prop up stocks. FPIs who have been on a buy mode since March, bought equities worth Rs 1,685 crore on Monday, provisional data showed.

The decline in retail inflation to an 18-month low of 4.7 per cent also lifted sentiment.