With the blazing bulls binging on bourses as if there is no tomorrow, it seems Indian investors has never had it so good in recent times.

And with bears having literally no room for much manoeuvre on the trading ring, except for short sally every once a while, Bombay Stock Exchange’s Sensitive Index was again on a song, growing strength by strength, each trading day.  

The 30-scrip Sensex, which has been scaling one summit after another, on Wednesday, came quite close to conquering the 18,000-point milestone, only to abate on profit booking, ending the day with a gain of 518 points — its third biggest point-wise rise.

The Sensex opened with a positive gap of 138.79 points at 17,467, rallied further to a peak of 17,953.07, a fresh all-time intra-day high and mere 47 points short of another milestone of 18,000.

However, sudden bout of profit-taking at higher levels saw it slip into red to low of 17,288 — down 665 points from the peak and thereafter, made most of its lost ground to end at 17, 847.04, up 518.42 points and an increase of 2.9 per cent. With this, the Sensex has now gained a whopping 15 per cent (2,343 points) in the last 11 straight trading sessions.

Likewise, mirroring the merry mood on the BSE, the broad-based index, ‘Nifty’ of National Stock Exchange of India (NSE) also soared to a historic intra-day peak of 5, 261.35 surpassing 5,200 level before being quoted at 5,261.35, up 141.85 from previous close of 5,068.95.

Frenzied FII buying

Hectic buying by Foreign Institutional Investors (FIIs) after the US interest cut and expectations of robust second quarter results, kept the market tempo upbeat, opined market operators.

Foreign institutional investors (FIIs) remained at the centre stage of current rally and pumped in nearly US$4 billion since September 19 and over US$12 billion in the current year so far, which, if sustained, would be a record. Foreign buying was $7.9 billion in 2006 and a record $10.7 billion in 2005.

The 11-day rally is longest since October  13, 2003. Twenty-four of 30 stocks in the index advanced. It was biggest percentage gain since September 19, when index jumped 4.2 per cent after a US rate cut the previous day boosted interest in emerging markets such as India.

However, in broader market losers beat gainers as out of 2,849 stocks traded, as much as 1,698 declined, while 1,108 advanced and 43 were unchanged during the day.

Rally across sectors

Overseas investors bought a net $856 million of Indian shares on September 28, according to latest figures from Securities & Exchange Board of India’s web site. That’s the most they have bought since June 29. Their total equity purchases this year reached a record $13.1 billion.

Foreign funds have bought $3.6 billion of shares in first eight trading days after the September 18 US rate cut. It has risen 15 per cent since September 17, the last day it posted a loss, and is up 27.6 per cent since August 21, when it ended at a three-month closing low of 13,989.11.

The rally was so strong that all sectoral indices were quoted up by nearly 1 per cent to 5.5 per cent in early trade with realty sec tor leading the pack. BSE Realty index zoomed 6.5 per cent to 9775. While IT index soared 4 per cent to 4783, and Oil & Gas index surged 3.2 per cent to 9995.

Market watchers , however, sounded a warning bugle, stating that gain of about 200-300 points each day in just four sessions and sudden surge to new peak indicates a bubble formation in the market. “The sudden dips and scaling of new peaks scares investors and nervousness is bound to affect the market sentiments any day,” they warned.