Stock market investors are smiling all the way to their banks. With the bull run, led by FIIs, taking the benchmark Sensex up by another 95 points to over 7,300 level on Monday, investors wealth — M-capitalisation of all listed shares — has jumped by another Rs 22,000 crore to an all-time peak of Rs 18.73 lakh crore.Continuing the upward march, the index jumped 94.66 points, or 1.3 per cent, to settle at a lifetime closing high of 7,306.74 on Monday. The Sensex hit a high of 7,320.25 in intra-day trading. The S&P CNX Nifty of the NSE rose 22.65 points, or 1 per cent, to settle at 2,218.85.‘‘The market is rising without any logic or rationale. FII money is sending the Sensex to unsustainable levels. Investors must realise that what goes up will come down also.. there’s hardly any change in the economic fundamentals to warrant a rally,’’ said a fund manager of a leading mutual fund.There’s a contrarion view also in the market. ‘‘The market talk is now about Sensex hitting the 8,000 level within a month. The sentiment is very bullish. the market is ignoring any negative news,’’ said NSE dealer Pradip Bhavnani.However, he admits some of the reasons put forward by market pundits for the bull rally are flimsy. If you look at the Sebi data, FIIs have driving Indian markets of late. After pulling out $261 million from India in May, FIIs invested $1.22 billion in June 2005. In July so far, FIIs have brought in $555 million to buy Indian stocks. Going by the current level of FII inflows, over $10 billion (around Rs 43,500 crore) is expected to flow into the market in 2005.While FIIs are merrily buying into equities, Indian mutual funds are sellers. This sale is mainly to take advantage of the high share prices and take care of redemptions.Besides, existing foreign operators are scaling up their Indian investment plans. Sabre Capital Worldwide, founded by former Standard Chartered CEO Rana Talwar, is teaming up with Temasek Holdings to raise up to $5 billion to invest in India. The combine will raise somewhere between $3 billion and $5 billion in the next five years. Calpers is also believed to have invested in the Indian market. The current FII inflow indicates they have increased their allocation for India. On the other hand, the Sensex has gained by 47.7 per cent from the 4,945 level in the last one year.Bulls in command• 47.7% is the Sensex gain in a year• How much FIIs invested$ 555 mn in July so far$ 1.22 bn in June 2005$ 5.17 bn in 2005 so far• No of FIIs registered: 734• But mutual funds are sellersRs 484 cr pulled out in JulyRs 1,816 cr pulled out in June
