MUMBAI: The Nifty could cross 9,000, and its all-time high of 9,119, in the coming days, as the BJP’s thumping victory in Uttar Pradesh sparks investor hopes of big reforms push by the rejuvenated Narendra Modi government.Apossible US Federal Reserve hike as early as next week could cause a drop in stocks but the effect would be temporary, as hike in US interest rates is factored into prices, according to brokers and market experts.The benchmark indices are expected to open with a gap-up on Tuesday and the Nifty could cross its life high set in March 2015 given the scale of the BJP’s victory in Uttar Pradesh. Victory in India’s biggest state, coming a few months after the demonetisation of 86% of the country’s cash in circulation, is expected to embolden the central government into taking more aggressive reforms. The win is also expected to improve the BJP’s numbers in the Rajya Sabha when elections are due in the Upper House this year and next year.“Investors value predictability and stability,” tweeted Anand Mahindra, chairman, Mahindra & Mahindra, one of India’s biggest car and tractor companies. “BJP’s resounding victory in UP points to longterm leadership. Markets may well applaud next week.”The Nifty ended Friday 0.7% below 9,000 and is 2.07% off its all-time high. The Sensex closed flat at 28,946.23, 3.73% lower than the all-time high of 30,024.75 touched in March 4, 2015, on Friday.“Markets are close to record highs and this win should put them past those highs,” said Vikas Khemani, president and CEO, Edelweiss Securities. “It will be taken positively by the market as it makes the government stronger and reinforces that the 2019 election would be more in favour of the BJP.Apart from the push to reforms, investors are also buoyed by prospects of the BJP increasing its numbers in the Rajya Sabha. In a note before the election results, brokerage CLSA said that while the election outcome will impact market sentiments in the near term, it is unlikely to have a long-term material impact. “BJP will emerge as the single-largest party in the Rajya Sabha after 2018 but will still be way short of the majority,” the brokerage said. “The election outcome from these states will not alter the Rajya Sabha meaningfully.”Majority in the Rajya Sabha is still crucial for the government to pass important legislation. While money Bills like the finance Bills can be passed with just consent from the Lok Sabha, other legislation like labour reforms may require Rajya Sabha support.The BJP was forced to abandon a crucial reform to liberalise land acquisition laws in 2015 after stiff opposition and reluctance of its allies.“The win is stronger than market expectation and could take the market Nifty to 9200 in this series,” said Pankaj Pandey, head of research, ICICIdirect. “For FIIs, I don’t think elections were a major hurdle and a Fed hike has also been accommodated in expectations. I am not expecting foreign inflows to pick up significantly soon.”Some others believe markets could cool off after an initial bounce. “Markets can overshoot but fundamentally it is fully valued. The outcome shows that Modi’s popularity is still intact. However, the outcome itself will not change things on FII flows front unless there is a concrete reform agenda announced,” said Gautam Chhaochharia, head of India research, UBS. The Nifty is trading at 17 times one-year forward earnings, higher than the MSCI Emerging Markets Index, which is trading at 11 times, Bloomberg data showed.Harsh Goenka, chairman, RPG Enterprises, tweeted on Saturday that the “decisive mandate for BJP will embolden Modi govt to shift agenda from political to growth. Stock market will rock and rupee strengthen”.“BJP's emphatic victory in the politically crucial state of UP would embolden the prime minister in aggressively expediting key structural economic reforms that have been hobbling India’s growth impulses,” said Ajay Bodke, CEO & chief portfolio manager-PMS, Prabhudas Lilladher.“Though valuations remain expensive, markets would pin its hope on recovery of as-yet tepid corporate earnings over the next few quarters and the passage of GST.”