Economy solid, Sensex headed for 18k, say pundits
The Bombay Stock Exchange 30-share index has gained 25 per cent from its April 2 low of 12,455, and talk of overheating is being dismissed, reports A Kumar.Updated: Jul 23, 2007 05:52 IST
The Sensex has crossed 15,600 in a swift climb within three weeks of touching what was then a skeptical 15,000. Analysts peering into Mumbai’s frenetic stock bazaar are now wondering if the 30-share index can go well beyond the highs it has touched.
With the monsoon rains pouring well, global experts are now talking of an 18,000-level, dubbing India, which is eyeing 9 per cent plus growth for the third year running, a "standout" opportunity in Asia.
"Our proprietary analysis and other technical indicators do not suggest that the market is overheated,” Morgan Stanley analyst Ridham Desai said in a report last week.
Jim Walker, chief economist at CLSA, an offshoot of France’s Credit Lyonnais, said a leash on money supply and exchange rates kept inflation under check, while domestic demand boosted confidence.
"Long-term factors such as demographics and the property market, along with cyclical positives such as falling unemployment, rising wages, positive credit cycle and strong stock-market participation, all support a bullish view of the Indian market," he said. "Here there is no 'boomophobia'. India is a resurgent economy."