Today's Paper Archive Classifieds Subscriptions RSS Feeds Site Map ePaper Mobile Apps Social

Business » Markets

Updated: September 21, 2010 18:53 IST

Sensex may surpass 21K mark by October: Analysts

Share  ·   print   ·  
An Indian stock broker reacts while looking at the rising Sensex stock index. File photo
AP An Indian stock broker reacts while looking at the rising Sensex stock index. File photo

Sensex may surpass the much-awaited 21,000-mark before the festival of Diwali, driven by the strong FII interest, analysts said.

Stock market benchmark Sensex, which had touched the 21,000-milestone on January 8, 2008, today breached the psychological high-level of 20,000 in the early trade.

This was the first time the Bombay Stock Exchange (BSE) index climbed the 20,000 - level since January 15, 2008, when it had closed at 20,251 points.

“Sensex may surpass 21,000 level before Diwali with the increasing FII interest. A lot of retail and institutional investors are waiting on the sidelines to park their money in the market, which means a lot of liquidity is yet to come in the market,” Geojit BNP Paribas Research Head Alex Mathews said.

Echoing a similar opinion, Kotak Mahindra Old Mutual Life Insurance Chief Investment Officer Sudhakar Shanbhag said,” The rate at which our market is rallying, surpassing the record level would not be a difficult task.”

The 30-share barometer of the BSE ended the month of August at 17,971.12. Since then it has rallied by 2,117 points in the last 15-trading days.

“This is a landmark achievement. The market and investors may see a good Diwali gift this season as the Sensex is likely to surpass the 21,000-mark. The fundamentals are strong, led by good growth rate and strong IIP data,” Ashika Brokers Research Head Paras Bothra said.

The industrial output, as measured by the index of industrial production or IIP, surged 13.8 per cent in July, accelerating from a revised 5.76 per cent growth registered in June.

Market analysts attributed the ongoing rally to the strong FII participation in the market. As per the Securities and Exchange Board of India data, foreign funds have invested Rs. 12,442 crore ($ 2.67 billion) in the Indian stock market in this month alone.

“The rally is driven by huge liquidity being pumped into the domestic market by the foreign investors. This is the beginning of a big move where the market may see the Sensex crossing the magical 21,000-mark, but investors should be cautious before any fresh investment,” another broker said.

Report from a brokerage firm said the Indian equities were in a structural bull run with the Indian economy structurally well placed for an 8-9 per cent GDP growth over the long period.

Stock markets have been rising throughout September, on the back of unabated inflows from the overseas funds, coupled with the firming global markets.

“If everything will be fine overseas, I do not see any hurdle for the Sensex to hit its all-time high in the coming days,” Sharekhan Fund Manage Suhas Samant said.

However, experts cautioned the stock markets were in overbought zone, which may create volatility in the coming times.

Keywords: SensexBSEstock markets

More In: Markets | Business



Recent Article in Markets

Gold jewellery being displayed at a show room in Chennai. A file photo: R. Raghu.

Gold prices recovered on mild retailers buying

Gold prices recovered by Rs 20 to Rs 30,250 per ten gram in New Delhi on Saturday on scattered buying by retailers for the marriage seas... »