The Telegraph
Since 1st March, 1999
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Atop peak at start of week
- Sensex bucks Asian trend

Mumbai, Oct. 30: The sensex surged past 13000 today — crossing another historic landmark as the equity juggernaut inexorably rumbles its way flattening records in its wake.

With just two months to go before the end of the calendar year, the question that lurks in the air is this: will it cross Point 14000'

The sensex has crossed four milestones this year — a feat that has never happened before. After trundling past 10000 on February 7, it went past 11000 in March and 12000 in April.

Opinion is divided over whether it could tear past another peak. The surge past 13000 took all of 135 days — and there doesn’t seem to be enough trading days to achieve another record-breaking feat.

“The continuity of the rally will depend on how the results season ends,” says Shashi Bhusan, Head (Retail Equities), IL&FS Investsmart.

Manish Sonthalia, vice-president (equity strategy) of Motilal Oswal, says, “The momentum is pretty strong in the market but the rise seems too fast and too soon. And when something rises very fast, it can come down equally fast.”

“The rally has been a qualitative one based on company performances. There is, of course, a fair amount of profit booking, but the rally is not artificial,” said Bhushan.

“However, going forward we see the market range bound with fair amount of profit booking,” he added.

The 30-share index bounced from early lows of 12844.85 to hit an all-time trading high of 13039.30 before ending with a 0.91 per cent rise over previous close of 12906.81. It scored a 3.18 per cent or 401-point rise in the three-day rally.

The nifty spurted by 29.75 points, or 0.80 per cent, to 3769.10 from its previous close of 3739.35.

The trading volume was, however, relatively low at Rs 3,715.86 crore compared with Rs 4,266.81 crore on Friday.

According to marketmen, healthy second quarter results, inflow of foreign funds, cheaper oil and firm US markets have aided the rally on the domestic bourses over the past few days.

“The second quarter results have been robust. There has been a topline growth of 30 per cent, with a bottomline increase of 35 per cent on an average. And the brokerage houses are expected to revise their earnings estimates,” said Sonthalia.

Since the beginning of earnings season on October 11, which Infosys kickstarted by beating the street expectations, the sensex has gained 670.77 points or 5.4 per cent from 12353.49 on October 11.

So far, the sensex has given returns of 38.5 per cent for the calendar year and one-year returns of 65 per cent.

However, today’s spurt has taken most players by surprise. “We have been able to pull it off though almost all the Asian indices were in the red today,” said Sonthalia.

Japan’s Nikkei ended down by 317.22 points, Hong Kong’s Hang Seng by 56.19 points and Korea’s Kospi by 12.98 points.

“Some big-ticket offers are set to hit the primary markets soon, which might take some toll on the liquidity,” said an analyst. Cairn India will raise $2 billion in December, while Parsvnath Developers’ IPO will hit the markets on November 6 to raise Rs 1,000 crore. Another mega issue from DLF is also in the pipeline.

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