Today, the festive spirit may linger on as far as the Indian market is concerned. The main indices saw new closing highs last week and the stage is set for them to register all-time intra-day highs this week. It could happen today itself given the upbeat sentiment underpinned by a robust economy, solid earnings growth and record FII inflows.
All said and done, valuations are getting a wee bit pricey. Therefore, one ought to be a little cautious and not get too carried away by headline-grabbing index levels.
The latest monetary easing by the Federal Reserve, coupled with a slew of public issues will lift the overseas inflows further. Coal India’s blockbuster listing and Obama’s visit have added to the feel-good factor.
Inflation too seems to be softening though it is still quite high. The RBI has hinted at a pause after six consecutive rate increases. All these factors put together point to continuation of the positive trend in the short to medium term.
