Riding on the economic reforms in the past few weeks, the benchmark Sensex will reach the 20,000 mark int eh near future, said a study by industry asscoaition Assocham today.
The chamber has attributed the bright prospect to the “return of foreign institutional investors (FIIs) and increased liquidity in the global markets” which has brought the focus back on the Indian stock markets.
At present, the Sensex is trading at 18760 and the Nifty is at 5650-5670 FIIs have brought in net Rs 19,000 crore ($3.5 billion) in the Indian stock market in September, the highest monthly inflow in seven months.
“The bold initiatives by the Government coincided with the quantitative easing of liquidity by the central banks in the US and Europe which are making desperate attempts to reinvigorate their economies,” an Assocham statement said.
The government opened up sectors like multi-brand retail and aviation for foreign direct investment and also revised the diesel prices in September. The measures were hailed by the business community whiich said these steps would boost "investment sentiment."
“The reinfusion of confidence by the domestic and foreign investors in the Indian economy was needed desperately in India which was coming under pressure from sharp depreciation of rupee and increasing current account deficit,” ASSOCHAM President Rajkumar Dhoot said.
The big uncertainty would, however, remain around the infrastructure stocks since it would still take some time before the policy issues are thrashed out, the statement added. Most of the infra stocks are trading at their dismal lows and several of the players in the sector are laden with big debts.
