Sensex has more than doubled in 2 years from 9K to 19K.
Now we have to ask does the SENSEX index can be hold as a parameter to judge Indian economy?
Ideally the Market indexes should reflect the underlying economy. But then we all know the Indian economy has not DOUBLED in 2 years, even with 10% annual growth it can be assumed it only grew by 25% in 2 last years.
So either the SENSEX was grossly under-estimated prior or now it is discounting for coming years of 10% growth.
RE:Does SENSEX really represents Indian Economy
by Hans Solo on Oct 16, 2007 08:50 AM Permalink
Also another important thing to note is that it took almost 5 1/2 years for sensex to move from 6k to 7K.
So maybe the sensex was grossly under-estimated at that time and hence doing a catch up now.
talking about indian sensex news, it has been stated that it has increased from 17000 to 18000 in just 8 days as on 6 oct, 2007. now on 15 oct 2007, it has again moved to 19000. my question here is that is this increase occured in real terms or just a bubble that can burst any time. because talking about the real value of rupee, it is increasing but at the decreasing rate and is not at all matching with the situation of this sensex. what is the reason that inspite of such a drastic increase in sensex, when india is positively thinking of some investment from abroad, there is no such increase in real sense
I have been in the market ever since index was at 3000 in 2001. This bull market is surely not for the pessimists. Pessimists are better of investing bank fixed deposits.
When ever the market breaks a new 1000 mark, I have been keep hearing from the so called experts that it is all overvalued.
These experts are gonna be right at some point. May be when the index reaches above 75,000. But they are not going to be right in the next 2-3 years.
it has remained the same. top 25% are doing well, the remaining are struggling to meet ends. This story has never changed for the last 60 years
We have farmers dying in Vidharba, we have millions of kids sleeping hungry with no future -- this pathetic situation is the real reflection of our economy, not the stock market.
for new inestors who are in the green now please take out your investment and let the profits run.if it goes up too much and you are having sleepless nights and dreams take out your profits too. when the shoeshine boy starts giving advice then its time to get out of the market. i have experienced a great bull run and fallen flat,because i didin't get out at the right time, when it dropped i thought it will come back again.no luck there. now i invest in the US market,still very cautious, once bitten twice shy. keep watching the US market the day there is a huge drop take out your money right away from the Indian market.its all tied in. then get back in if they cut interest rate in the US. invest only in small caps or mid caps with the money you can afford to lose and not become a poor man. large caps are all well researched and their price is pretty much the right price so don't think they will grow rapidly. and don't forget about earnings, future earnings are the most important. good luck. all though i am a skeptic i still believe if you are not in the market you are losing out a lot.
Let only people who are active investor worry about this senxex. Other people need not worry about this since this dam thing keep going up, down according to the money pouring in, out. It does not show any other thing. Nation should worry about basics of economic grwoth, like building infrastructer, providing quality service, product. etc in the world market.
RE:!
by on Oct 16, 2007 08:37 AM Permalink
I strongly disagree with this statement. There are winners - I'm one of them. Losers are those who invest blindly on tips because most often they are the last in line and the first to be hit! by Macvi
I wonder why this is not reflected in the GDP industrial./agri. production and BPL rate. The astronomical heights to which the sensex is rising smells of tainted/.drug/narco-terrorist/ money and a huge crash in the offing. Beware.
RE:RE:Sensex at 19k
by Kannan SivaramanViswanatha on Oct 15, 2007 09:07 PM Permalink
I can certainly share your conservatism that the index has risen too fast in less than 45 days. Everyone says FIIs are pumping loads of money chasing the future growth of indian companies. One cannot rule out the possibility that in the cash downpour from FIIs some portion could indeed be tainted, the potential for such a probability is strong. The best advice for retail investors is to take the Mutual Fund route through SIP and watch the scene as it unfolds itself in the coming weeks. Society Generale now puts a target of 25000 for 2007 year end and 30000 for Q1FY08. This is the most ambitious prediction by far. No retail investor should enter into direct equity purchase at these levels. Whenever there is a strong trigger to pull down the market, how soon is anybody's guess, the market could plunge and the fall would be heavy. Even if you are a long term investor, this is not the right level to enter. But, even if you enter, it should be with your own funds that can be safely set aside without affecting your day-to-day life and that of your family. LEVERAGING is a strict no-no at this level.
RE:Sensex at 19k
by stav on Oct 16, 2007 05:51 AM Permalink
Indians should invest at every fall. We have very strong fundamentals. That is the reason, the world is having confidence in investing here. Ofcourse our development reflects on GDP, We have a constantly rising GDP.
