Deutsche raises BSE index target to record high of 22,000

Says investor pessimism is receding amid positive developments

Deutsche Bank raised its December 2013 target for the BSE Sensex to a record high at 22,000 points from 21,000, saying investor pessimism earlier this year was receding amid positive developments such as a good monsoon.

Among other positive factors, Deutsche mentioned a bottoming out in the economy, the likely withdrawal of liquidity tightening measures by India's central bank, a synchronized global growth recovery and a Federal Reserve that has delayed tapering of its monetary stimulus.

Deutsche Bank also named banks as its top "overweight" in its model portfolio, citing receding concerns over tight liquidity and higher short-end interest rates. Meanwhile, it cut IT services to "neutral."

The benchmark BSE Sensex fell 0.2%, or 42.45 points, to end at 20,725.43 on Thursday. The index's all-time high is 21,206.77, hit in January 2008.