The market is in uncharted territory following a solid surge in the past three trading sessions in what is largely seen as a pre budget rally. The Sensex has gained 424.98 points (3%) in the past three trading sessions from 14,090.92 on 31 January 2007. The market sentiment is firm due to US Federal Reserve keeping interest rates steady at its 31 Jan 2007 meeting. Sentiment was also boosted by the RBI, on the same day, raising fiscal 2006-07 GDP growth forecast upwards to 8.5% to 9% from earlier 8%. The barometer index is up 5.2% in calendar 2007 thus far.
FIIs steeped up buying on Friday 2 February, the day when Sensex had risen 137 points. They were net buyers to the tune of Rs 664.60 crore on that day. As per provisional data, FIIs were net buyers to the tune of Rs 463 crore on Monday 5 February, the day when Sensex had risen 112 points.
FIIs were net buyers to the tune of Rs 608 crore in index-based futures on 5 February. They were net sellers to the tune of Rs 167 crore in individual stock futures on that day.
Meanwhile, as per reports in a section of the media, the government may raise short-term capital gains tax on shares to 15% from 10%. However, since the proposal is market sensitive, opinion is dividend with the finance ministry in this regard, the report suggests.
Healthy company results and outlooks lifted Japanese shares on Tuesday and stocks elsewhere in Asia hit a record. MSCI's index of non-Japan Asian shares rose 0.2% to hit a fresh record and to stand a third higher than the middle of 2006. Australia's S&P ASX 200 reached a record too and was 0.5% higher.
US stocks ended mixed on Monday, with losses in shares of Microsoft Corporation weighing on technology shares. The Dow Jones industrial average gained 8.25 points, or 0.07 percent, to end at 12,661.74, while the Standard & Poor's 500 Index dipped 1.40 points, or 0.10 percent, to finish at 1,446.99. The Nasdaq Composite Index fell 5.28 points, or 0.21 percent, to close at 2,470.60.
Crude oil sat near Monday's one month peak just short of $60 a barrel, supported by a blast of cold weather in the United States.