FIIs lift Nifty above 6K, Sensex above 20K this week

The bull run in the markets continued despite encountering profit booking in previous two days, mainly due to FIIs remaining net buyers. The equity benchmarks closed the week above their psychologically important levels-the Sensex above 20,000 mark and Nifty above 6000 mark. Foreign institutional investors (FIIs) have been leading the markets since June 2010 taking the indices to their 32-month highs.

Experts were expecting  markets to test thier all-time highs in near term on strong funds flows into Indian equities. FIIs were net buyers to the tune of more than Rs 20,500 crore in the month of September itself and around Rs 59,000 crore since June 2010. The markets were down on Wednesday and Thursday owing to profit booking, however, FIIs remained net buyers to the tune of over Rs 2,000 crore.

Commenting on the strong inflows, Jeff Chowdhry, Head of Emerging Equities at F&C Investments said, emerging markets would continue to attract flows. "It's not just India that will carry on attracting money, but other emerging markets as well. Global investors are very happy to pay for growth. A lot of people talk about valuations in emerging markets and obviously India is one of the highest valued markets around,'' he explained.

Gautam Shah, VP, Financial Services at JM Financial said that the markets can rise substantially from the current levels. According to him, Sensex has a strong support at 19,600. Pegging Nifty target at 6,250-6,300 in two months, Shah feels it will consolidate at around 6,300 mark.

However, Shah sees markets going through a minor pause in October, which he says can be used as a buying opportunity. He further elaborated, ''The Nifty has a base at 5,550 now. Investors can use any 2-3% dip as a buying opportunity."

Almost all sectors witnessed buying interest on Friday; realty, FMCG, financial, telecom and infrastructure were the leading sectors. However, Jindal Steel, Cairn, Sterlite and Tata Motors were the only loser on Nifty