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The Sensex scaled 20,000 yet again this week, after a month, and the Nifty touched a new intra-day high past 6,000. Profit booking did not allow the indices to remain at such high levels. There have been different opinions on Indian markets emerging from various fund houses. Citibank in a report pointed out that India was the second most expensive market in Asia. Bloomberg reported that HSBC's investment director, Sanjiv Duggal, would ask his investors to cash out and UBS raised its target for the Sensex from 19,000 to 22,600 by the end of 2008. Standard & Poor's was neutral on India, said Lorraine Tan, head Asia-Pacific equity, who believes that the market is at a comfortable point with corporate earnings growth to support a further upside in 2008.

The coming week has on its line-up the most important event world markets have been looking forward to: the meeting of the US Federal Reserve on December 11. While a rate cut has already been discounted by the markets, one hopes the domestic political scene does not upset the rate cut party. The weekend saw a renewed threat from the Left over the continuation of meetings with the International Atomic Energy Agency and Communist Party of India (M) General Secretary Prakash Karat warned that the government should withdraw from talks by December or be prepared for polls. On the macro-economic front, Finance Minister P Chidambaram’s mention of rising capital flows posing a risk should be kept in mind.

Information technology majors made a comeback last week. Infosys gained 7 per cent, Wipro 9 per cent and TCS over 5 per cent as investors who thought the worst was over the industry decided to take contrarian bets. Energy stocks continued to be active and realty stocks gained over copious news flows. Fund-raising plans pushed Reliance Energy up by 11 per cent and Tata Power gained 12 per cent. Mid-caps continued to outpace large-caps last week and some suspect a bit of front running even as funds continue with new fund offers and collect decent sums. Investors and fund managers alike continue to hunt for value unlocking from land holdings. Automobile ancillary stocks like MICO and MRF saw some volatile movement last week.