Sensex ends above 20K, Nifty above 6K on FII support
21 Sep 2010
Bulls remained charged up by huge inflow of funds from foreign institutional investors (FIIs) and pushed equity benchmarks - the Nifty above 6,000 and Sensex above 20,000 - important psychological levels - at close for first time since January 15, 2008.
Ramesh Damani, Member, BSE said that the market is likely to head much higher after consolidation. According to him, the market will even test 21,200 but the route is likely to be a difficult one. He explained, "The market might spend sometime consolidating. 21,200 is a psychologically brutal level of the market. It will spend time, in my opinion, consolidating at those levels, but ultimately this bull market will probably head much higher."
While explaining factors, which aided this rally, Devang Mehta of Anand Rathi Financial Services said, "It's been a great rally. I feel there is some steam still left in the market. Let me take you through some little factors which are impacting this great bull run that we are seeing. It's been a dream run this time around. What we are seeing is wonderful gross domestic product (GDP) numbers, economy numbers, the Index of Industrial Production (IIP) data that we have seen. All these things are hinting towards a very positive momentum.
The next two-three years is going to be a strong phase of macro growth, says Ratnesh Kumar, MD, Standard Chartered Capital Markets. "Within that strong phase of macro growth, you are likely to see investment boom, which is going to be potentially bigger and better than even the 2003-2007 capex move.''
FIIs played the biggest role in this rally - they were net buyers to the tune of more than Rs 53,000 crore since June 2010 and buyers of more than Rs 75000 crore in calendar year 2010. Vinay Menon, ECM Head, JPMorgan India says, ''We are seeing fresh pools of money come into India, we are seeing new accounts come into these issues, which means investors globally are looking at India very positively.''
Buying in capital goods, technology, healthcare and HDFC group companies' shares along with NTPC, Tata Motors, Maruti, HUL and Tata Power supported markets throughout the session. However, the sell-off in realty, metal and ADA group companies' shares along with ITC, Reliance Industries, SBI, Hero Honda and ICICI Bank limited gain to major extent.
