Resurgent Sensex up 92% in a year
Diwali-eve saw the Sensex hit a new 17-month high, rising 92.3 per cent between Diwali last year and this one, reports Sandeep Singh.business Updated: Oct 17, 2009 02:12 IST
Diwali-eve saw the Sensex hit a new 17-month high, rising 92.3 per cent between Diwali last year and this one.
From the depths of the downturn, from a despondent low of 9,008 points on October 28 last year — which then fell to 8,160 points in March this year — the Sensex has risen like the phoenix to touch 17,323 points on Friday.
The broader NSE Nifty rose 34 points to close at 5,142.
“Global markets bottomed out in March and since then it has been a consumption-driven revival followed by flow of funds into emerging economies that have rallied more,” said Aseem Dhru, CEO, HDFC Securities.
Consumer-led demand that is leading a broader revival is one of the reasons why the Indian market has been attracting global attention. To take just one aspect of this demand, Thursday saw 25,000 cars sold, a record. “This season has been one of the best for us,” said Jnaneshwar Sen, V-P marketing, Honda Siel Cars India.
The other reason why markets are up is funds flow. “This has been a liquidity-driven rally,” said Parag Parikh, chairman, Parag Parikh, Financial Advisory Services.
Since March, foreign institutional investors have invested Rs 72,151 crore in Indian equities, with October seeing an investment of Rs 6,881 crore.
But to investors planning to jump in now, experts advise caution. “I expect a correction now and profit booking is likely to happen on Muhurat trading on Diwali,” said Amitabh Chakraborty, president (equity), Religare Enterprises. “Investors should be cautious.”