Too high, too soon: market players are concerned

Thu, Oct 1 11:00 AM

New Delhi, Sept. 30 -- Market players seem unanimous on the fact that Sensex at 17,000 has crossed its fundamentals and suggest that a correction lies ahead.

While the total FII inflow into the equity market since March 2009 stands at Rs 64,767 crore, almost 30 per cent or Rs 18,344 crore came in September alone. Experts suggest that redemption pressure on hedge funds will lead to correction.

"Buried under redemption pressure last year, hedge funds took a moratorium period of one year and hence redemptions on hedge funds are expected now," said Amitabh Chakraborty, president equity, Religare Enterprises. " I expect corrections to the tune of 10 per cent towards the end of October.

" Apart from FII inflows and strong advance tax numbers, the market is upbeat about corporate expectations in the second quarter that ended on Wednesday. But there is a flip side.

"Any company that disappoints the markets expectation on results will lead to a correction," said Manish Sonthalia, portfolio manager, Motilal Oswal Financial Services.

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