Sensex and Nifty have logged a phenomenal rally in the last nine months. Sensex has rallied 20,369 points or 78.39% from March 23 when benchmark indices suffered their worst losses ever. Similarly, Nifty has gained 5,979 points or 78.56% compared to the close of March 23.
Sensex and Nifty logged their highest losses ever on March 23 after rising number of coronavirus cases in India and the resultant lockdown in a majority of states took a heavy toll on the financial markets. While Sensex lost 3,934 points to 25,981, Nifty closed 1,135 points lower at 7,610.
The spectacular rally has been supported by value buying, run-up to the US Presidential election and the ensuing results, FII inflows into equity markets, signals of economic recovery and announcements of coronavirus vaccines which could put the global economy back on growth trajectory.
The momentum of the rally has been so strong that Sensex surpassed its all-time and pre-Covid high on November 6. The index closed 724 points higher at 41,340 during the same session.
On February 19, Sensex had closed at 41,323.
Since November 6, the index has been scaling record highs in almost every session till date. Sensex hit an intra day high of 46,350 today. It logged all time high of 46,373 on December 14.
With bulls in charge of Dalal Street , the possibility of Sensex hitting 50K looks strong in this year only.
Here's a look at what analysts said on the chances of Sensex scaling 50 K level this month.
Deepak Jasani, Head of Retail Research at HDFC Securities said, "The possibility of Sensex hitting 50K is unlikely. We have 12 trading sessions left. The last 4,000 point rally in Sensex took 24 sessions. As we move higher, the further climb becomes more difficult and needs bigger triggers. Most known triggers seem adequately discounted in the current price. Also absence of a lot of FPIs due to Christmas/year end holidays may make it difficult for indices to rise sharply, though local traders could have a field day."
Abhijeet Ramachandran, Independent Analyst/ Co-Founder and Trainer at Tips2Trade said, " During the last 2 months, both Nifty and Sensex have recovered and given stellar returns. However, 46,860 will be the maximum level that could be hit this month as every positive news related to the COVID 19 vaccine and economic recovery has already been factored in. Infact, both the indices look set for a good correction with BSE Sensex expected to fall till 44,350-44,830 in the coming weeks. Investors are advised to keep booking profits at current levels."
Hemang Jani, Head - Equity Strategy, Broking & Distribution, at Motilal Oswal Financial Services said, "The overall momentum is very strong across large, mid and small cap stocks. FIIs have pumped in more than Rs 65,000 crore in November 2020 and more than Rs 25,000 crore in December 2020 so far. Hence, if the flows continue, we may see further upside in Nifty and Sensex. It is difficult to gauge whether Sensex will touch 50k in Dec 2020 itself. The rally could definitely continue into 2021 if economic data continues to be strong."