change in sensex

The new records set by the Indian stock market with sensex closing at 21000 and Nifty above 6300 is something more than symbolic significance.This implies that market would scale new highs.The inflows from the foreign institutional investors might be one of the factors contributing to this rise.The major repositories in US are reviewing and re-rating india as a preferred destination and they are investing in bulk out of their propensity for risk in the high yielding emerging markets might be another reason.The possibility of a major change in the indian stock markets cannot be ruled out on account of the decision of federal reserve for deficit financing to the tune of $600 billion as about a fifth of the holdings in the indian stock market is owned by the foreign institutional investors.