Sensex may hit 14,000

The barometer index BSE Sensex may test 14,000 level tracking firm global markets and drop in crude oil prices. It is just about 125 points away from that psychologically important level. Nifty has already achieved the psychological 4,000 level. For the first time, it settled above that level on Monday 4 December.

Market sentiment remains strong due to strong FII inflow, continued strong economic data and robust corporate earnings. Firmness is likely to prevail in the near term as traders will build positions on expectations of strong Q3 December 2006 results.

FIIs bought shares worth a net Rs 349.30 crore on Friday 1 December as compared to an inflow of Rs 258.10 crore on Thursday 30 November. The cumulative FII inflow in 2006 has reached $8.9 billion compared to a record inflow of $10.7 billion in 2005.

Meanwhile, a sudden sharp surge was witnessed in inflow from mutual funds as they bought shares worth a net Rs 304 crore on 1 December.

Asian markets were steady to firm on Tuesday following gains on Wall Street on Monday. Key benchmark indices in Hong Kong, Japan, South Korea and Singapore were up by between 0.1% to 0.98%.

US stocks rose on Monday as a string of corporate takeovers and lower oil prices boosted optimism about the outlook for profits. The Dow Jones industrial average rose 89.72 points, or 0.74 percent, to 12,283.85. The Standard & Poor's 500 Index gained 12.41 points, or 0.89 percent, to 1,409.12. The Nasdaq Composite Index added 35.18 points, or 1.46 percent, to 2,448.39. The S&P 500 soared to a six-year high during the session, while the Nasdaq recorded its biggest one-day percentage gain in nearly a month, snapping a two-session losing streak.

NYMEX crude for January delivery ended down $1.08 a barrel at $62.35 amid forecasts of warmer weather in the United States and doubts among traders of another OPEC production cut.