Dream run to continue as bulls yet to lose steam

Bulls are continuing with their dream run on the Dalal Street.If the current situation is any indication, the BSE Sensex and NSE Nifty will ...

Bulls are continuing with their dream run on the Dalal Street.

If the current situation is any indication, the BSE Sensex and NSE Nifty will continue in the bull orbit as fresh inflows are consistently coming from the FIIs. FIIs have so far, during the fortnight, invested a huge Rs 3,696.20 crore, of which Rs 2,420 came in from the last week.

Also the US markets stayed firm, with Dow Jones staying above the 10,500-mark and the Nasdaq Composite ending above the 2,250-level.

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The firm trend in Asian markets will boost sentiment for the coming weeks, according to analysts. “All the emerging markets are witnessing a bull run. India cannot be an exception,” said a BSE dealer.

Marketmen are also happy with the government’s actions on the reforms front, especially disivestment and liberalisation of various sectors. The markets are waiting for the next trigger, which will be provided by the quarter ended December 2005 results by Indian Inc.

Most of the analysts estimate that India Inc will report better growth for the December 2005 quarter as compared to the September 2005 quarter.

Also any further decline in crude oil prices will provide a short-term trigger.

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The NYMEX light crude oil for January delivery stayed close at $60 per barrel while the London Brent crude was also near $60 per barrel.

However, valuations of Indian stocks have risen along with the earnings growth and Indian market is no longer undervalued.

The Sensex currently trades at a PE multiple of 18.22 based on its trailing 12-months September Earnings Per Share. The BSE Sensex ended the week to close at 9,284 points. It advanced by 150 points or 1.65 per cent during the week.