Sensex surges 1280 pts in 7 trading sessions

Equity benchmarks carried on their upmove for the seventh consecutive day on strong inflow from foreign institutional investors - the Sensex surged more than 1280 points and the Nifty rallied over 380 points in seven sessions.

David Fuller of Fullermoney.com says India is a very good story. In the short term may be it's a tiny bit overbought, he said. "India has been my favourite stock market for a very long time, really going back to 2003.

What's very good is that India has broken free of that long trading range that we had on the Sensex between 16000 and 18000. So it has broken upwards from that and certainly before the year end I think that it will at least test the 2007 and 2008 high."

Even Pathik Gandotra of IDFC Securities expects the markets to test all time highs and said the strong growth momentum in the economy would continue. This rally, he said, mostly propelled by FII buying coming in from the US. FIIs had been bought more than Rs 8,300 crore worth of equities in previous six days.

Momentum was led by oil & gas, technology, metal and private financial companies' shares on Wednesday, which helped the Nifty to close above 5850 despite mixed global cues.

According to Ambareesh Baliga of Karvy Stock Broking, the Nifty can still head higher. ''The market can immediately move to the levels of around 5,900-6,000.'' However, he doesn't rule out the possibility of a correction.