Sensex gains for 3 consecutive weeks, up 8% on FII money

The market showed excellent performance for the third consecutive week led by strong inflow of money, tracking positive global cues. Gradual easing of funding problems in the eurozone, improvement in the economic data of United States, appreciation of rupee and October-December quarter earnings helped the market to rally nearly 8% in three weeks. Even investors started putting money into the most beaten down stocks in the last year.

Today, the Sensex rose 95.27 points, to close at 16,739.01 and the Nifty went up 30.20 points, to settle at 5,048.60.

Foreign institutional investors stepped into India with strong footing, taking exposure to about Rs 6,000 crore worth of equity shares since the beginning of 2012, very encouraging as compared to net sellers of Rs 3,642 crore in 2011. Rahul Chadha of Mirae Asset Global Investments expects foreign inflows to revive into India going ahead.

Amit Dalal, Executive Director at Tata Investment Corporation feels the market has become attractive in terms of both - the competitiveness of Indian industry and valuations. "We technically have a very sound picture right now for the market because of the inflows seen in last 15 days."

According to Chris Wood of CLSA, the improving sentiment towards the Eurozone has definitively helped India's efforts to shore up its currency since a renewed swing to 'risk-off' would almost certainly hit the rupee. The Indian rupee appreciated sharply to 50.4 a dollar from a record high of 54.3.

The move has been quite sharp, hence Amit Dalal feels the market may take some rest before further upside, coming in before the budget.