Sensex zooms past 16K

Mumbai
Sept. 7: The positive statements from the G20 countries that the stimulus packages would not be rolled back, sent positive reverberations to the US markets that closed high on Friday and the Asian markets that opened positive on Monday morning. The Sensex and the Nifty opened positive but no one foresaw both the Sensex and the Nifty smashing through the psychological barriers and hitting their 15-month highs (last seen in June 2008).
The Sensex closed 327.20 points up at 16,016 while the Nifty was up 102 points to close at 4,782.90. They were the stars of Asia where the Hang Seng was up 310.69 and the Nikkei 133.83 points. It received support from the European markets too that were buoyant.
The US markets were close on Monday for the labour day holiday. “The optimism on the bourses clearly reflects the recovery in investor sentiments on the back of the domestic economic recovery that is already underway. With the monsoon fear factor now behind us and positives like sequential improvement in corporate profitability and GDP growth creeping in, investor confidence has found some support,” said Mr Dinesh Thakkar, the chairman and managing director of Angel Broking.
FIIs were also seen buying on Monday after being sellers on Friday.
“The market was supported by FII buying and short covering,” said Mr Amba-reesh Baliga, the vice-president of Karvy Stock Broking. “Clearly the market has broken the psychological barrier of 4,725 and the 4,900 levels are now possible,” he said.
The Sensex could touch 16,700 after breaking through the 16,000 psychological barrier, Mr Baliga said adding that he does not see any negative issue for the markets for the next few days.
However if for some reason there are some people who feel that the market is still overvalued there could be a sharp correction, he said. But “we are in a bull phase, there is no doubt,” he said.
Mr Pradip Hotchandani, the technical analyst at Anagram Securities Ltd, said if you see the last few trading sessions were a phase of consolidation and the market decided to break out. The technical charts show an ascending triangle formed and when there is a break out one can expect that in the short term the Sensex can go to 16,500 and in the medium to 17,500, he said.
Mr K.V. Kamath, the ICICI Bank chairman, add-ed to the positive sentiment saying that Indian recovery was round the corner and with the monsoon picking up he predicted the GDP could grow by seven and a half per cent to eight per cent.