MUMBAI, JANUARY 3: Stock markets greeted the new millennium with a scintillating rally on Monday. Share prices and indices soared to record highs as bulls hit the year 2000 running after a glitch-free millennium changeover. The benchmark Sensex opened at a record high, rose further through the morning and closed higher by 7 per cent or 369.29 points at 5,375.11.With a buying wave sweeping the market on the first trading day of 2000, the investors wealth (or the market capitalisation) rose by nearly Rs 1,00,000 crore to over Rs 10,00,000 crore. The rise was largely fuelled by local speculators and retail investors, dealers said. Monday's surge comes on the back of a 64 per cent rise over 1999.The previous closing high was 5,075.39 reached in October last year. On Monday, Sensex opened at a record peak of 5209.54 and gradually moved upwards to the day's high of 5384.66 before closing at a historic high of 5375.11 as against last Thursday's close of 5005.82. The National Stock Exchange S&P Nifty index was up 7.58 per cent or 112 points at 1,592.70.While part of the euphoria was because of the problem-free transition to 2000, speculators were also buying in anticipation of fresh foreign fund flows, dealers said. Software shares shone in the rising market with most shares frozen at the upper end of the eight percent circuit breaker limit. Infosys Technologies closed up Rs 1,161.25 at Rs 15,677.50 where it was frozen in early deals. Heavyweight Hindustan Lever ended 6.2 per cent higher at 2,391.20. Other leading counters like ACC, ITC, Larsen, Reliance, SBI, Telco and Tisco are among 84 A group scrips which hit the circuit breaker and trading was stopped as their prices crossed the permissible 8 per cent limit.``A very exciting start to the new year," declared Sangeeta Purushottam, head of research at SG Asia Securities. "Relief of Y2K being over without any glitches and hopes of fresh money coming in has buoyed sentiment," she said. Says Venkatesh Aiyar, a dealer with broking firm R K Chari: ``Everyone is buying today. from local institutions to FIIs. Mutual funds and individual buyers also joined the buying spree as there was no bad news to prevent the Sensex from going up.''``With the Indian economy on an upswing, Y2K fears over, and more good news like 100 per cent HDFC millennium dividend, we are set for some new records,'' an optimistic Aiyar told this newspaper. Dealers said shares across most sectors had risen in morning deals but information technology shares were at the helm, with several at the eight per cent circuit breaker limit. "The markets have gone crazy," said Purvesh Shah, chief dealer at KJMC Capital Market Services.All the 11 critical sectors identified by the government reported a snag-free millennium transition, officials said at the weekend. Traders said sentiment was strong as the market pinned its hopes on heavy buying by foreign funds in the days ahead. ``Fund flows should be better than expected this year. Regional economies are looking up and that sentiment should rub off,'' said Nilesh Jain, vice-president of institutional sales at Motilal Oswal Securities.According to the Securities and Exchange Board of India, foreign funds invested over $1.5 billion in Indian markets in 1999. However, the market sentiment could deteriorate towards the middle of January as third quarter results in some sectors could be disappointing, but position-taking ahead of the federal budget may provide support later on. The government is expected to present its budget for 2000/2001 (April-March) by the end of February.Some dealers said a technical correction could some sooner as a short settlement at the National exchange which started Monday and ended Tuesday prompted position-squaring. Others cautioned that the market had moved too fast. "There are danger signals here," said a broker. Eyes are on the foreign funds to see whether they book profits before resuming their buying spree.
