This is a discussion on India's key market index nears magical 8,000 mark within the Investment forums, part of the Financial Services category; India's key share market index rose to an all-time high Monday, bringing it closer to the magical 8,000 mark, as ...
India's key share market index rose to an all-time high Monday, bringing it closer to the magical 8,000 mark, as overseas investors pumped in huge funds on hopes of robust corporate earnings.
Mirroring the bullish investors' sentiment, the stock market barometer 30-share Bombay Stock Exchange sensitive index or Sensex closed at 7,925.24, a gain of 25.47 points or 0.32 percent over its previous close.
The market index bettered its previous high of 7,899.77 touched Friday on across the board buying interest.
The stock market closed in the positive zone for the week ended Friday after sliding slightly lower in the last week.
India's blue-chip equities had soared sharply higher in the last few weeks on massive inflows of overseas funds and hopes that a normal monsoon would boost economic growth in the current year.
"The market was expected to touch the magical mark of 8,000 for quite some time now. We may see the level of 8,000 getting breached for the first time in its history in a day or two," said an analyst with a brokerage firm.
"After touching the 8,000 level, the market is likely to face some resistance and institutional profit booking will pull it down from the sharply higher levels," added the analyst.
"The bull-run on the bourses is being led by string liquidity. The sustained inflows of overseas funds has enthused domestic investors who are discounting negative factors like the sustained increase in the global crude oil prices."
Higher global crude oil prices trigger fears about its impact on the economy of India, which imports nearly 70 percent of its energy requirements.
India's oil companies, which are the biggest contributors to the central kitty, are no longer in a healthy state with the sustained rise in the global crude oil prices and a freeze on price hikes in the domestic market.
Shares of state-run refiners have turned worst performers in the Indian stock markets with stocks of IndianOil Corporation and Bharat Petroleum Corporation plunging over 15 percent and 20 percent respectively in the current year.
Overseas funds, termed as the backbone of India's liquidity-hungry equity market, have invested a whopping over $7.5 billion in Indian equities in the current year.
This compares with a sell-off of $261.30 million in May and $149.50 million in April. Foreign institutional investors collectively put in a record $8.5 billion in the last calendar year, up from $6.5 billion worth of inflows in 2003.
In the old economy sector, shares of Gujarat Ambuja Cements closed with a gain of 4.6 percent to touch Rs.71.90 on market talks of a hike in the cement prices in the domestic market.
Hero Honda Motors, the country's largest motorcycle maker, ended nearly two percent higher at Rs.696 on hopes that the company would post impressive earnings growth in the quarter ending Sep 30.