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| Dalal Street likely to touch fresh highs this week: Analysts |
| Press Trust of India / Mumbai Aug 02, 2009, 13:50 IST |
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Continuing the bull run, Dalal Street is likely to touch fresh highs this week, primarily fueled by higher funds flow from foreign institutional investors (FIIs) amid positive global cues, believe analysts.
"The market will remain strong this week on the back of foreign money coming in from institutional investors. The rally would continue in the market and some more highs would be breached," Ashika Stock Brokers Research Head Paras Bothra said.
Marketmen said with better-than-expected June quarter earnings by corporate houses, confidence is back in the market and risk appetite has increased.
"Market has crossed the resistance levels and the corporate earnings figure were good. Flow of money would keep the market buoyant," Unicon Financial Chief Executive G Nagpal said.
Analysts say a rally is on the anvil for the large cap stocks, besides banking, metal and oil & gas sector, as they have underperformed in the last week.
"Weakening dollar will drive money into the market, which will pull FII investment. Results have been good for India Inc and large cap stocks would now do better," SMC Global Vice President Rajesh Jain said.
July witnessed inflows worth Rs 11,066.30 crore ($2.28 billion) in the Indian stock market and the stock market rose over 8 per cent. Besides, the total FII investment so far this year has crossed $7 billion.
The Bombay Stock Exchange benchmark Sensex recorded gains for the third straight week ending on Friday and surged about 2 per cent to close at 15,670.31 points, at nearly 13-month high level.
However, analysts caution that a correction might come in as the US markets are already overbought.
"The week might see some consolidation coming in as markets have rallied quite a lot. Bits of correction in the middle of the week cannot be ruled out," Bonanza Portfolio Assistant Vice President Avinash Gupta said.
The National Stock Exchange's Nifty index ended with a gain of 68 points at 4,636.45 points on Friday.
"Alongside FIIs, domestic institutions are also participating in the rally. With good Q1 figures, flow of money is back in the system," Nagpal said.
On Friday, the US markets were mixed with the Dow Jones Industrial Average gaining 17.15 points to 9,171.61 and the Standard & Poor's 500 Index rising 0.07 per cent to 987.48 points. While the tech heavy Nasdaq was down 5.80 points to 1,978.50.
"The US markets have extended the rally and it is highly overbought. Investors should trade with caution as there might be some correction on the anvil," Jain noted.
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