[vsrivatsa]

Sensex Breaches 50,000 Mark for the 1st Time Ever : Link

The S&P BSE Sensex breached the 50,000-mark for the first time during the early trade on Thursday aided by market heavyweight Reliance Industries (RIL), and the Bajaj twins comprising of Bajaj Finserv and Bajaj Finance amid positive cues from the global market.

The Sensex surged 334.61 points (0.67 per cent) to hit a record high of 50,126.73, while the broader Nifty 50 too climbed 93.60 points (0.64 per cent) to touch a new lifetime high of 14,738.30.

Multiple opinions of course:

Sensex hits 50,000-mark for first time ever: Top reasons behind the surge: Link

Sensex at 50,000: Warning signs of an overheated market : Link

[five46]

Good time to book some profits and do a rejig of the portfolio now that the budget is also around the corner.

[SmartCat]

I'm surprised by the attention this is getting even in mainstream media. Because except for a few old hats, nobody else tracks Sensex levels. NSE has completely taken over the equity and derivatives market in terms of market share. Index mutual funds too track Nifty 50 and not Sensex.

[Marshall]

Originally Posted by five46

Good time to book some profits and do a rejig of the portfolio now that the budget is also around the corner.

Rightly said, time to slow down and watch from the gallery.

[slayer23]

I think the 50k is a good milestone to talk about and hence being tracked so closely. I agree that Nifty is what is more prominently tracked nowadays.

That said this rise has been nothing short of phenomenal. I remember once the recovery started in July/Aug talking with my friends about the possibility of Nifty hitting 13k by Mar'21 and maybe 15k by Mar'22 and planning our investments.

The current surge was unexpected and most of my friends have exited at various points during the last 2 months hoping for a dip/crash to re-invest. I too have been of the same view and thus have rejigged my portfolio quite a few times.

Any thoughts on what sectors to watch out in the next 12 months? I plan to continue to be invested in FMCG for stability [low growth, but stable and high dividends] and I expect the auto industry to grow [EV although small now could witness auto cos invest for future]. Pharma as a whole is an industry which would benefit but I don't understand enough to differentiate between different types of companies [APIs manufacturers, generics, speciality pharma, etc].

[RedTerrano]

Originally Posted by SmartCat

I'm surprised by the attention this is getting even in mainstream media. Because except for a few old hats, nobody else tracks Sensex levels. NSE has completely taken over the equity and derivatives market in terms of market share. Index mutual funds too track Nifty 50 and not Sensex.

I am a total noob when it comes to stock markets. But the graphs seem to indicate a similar upward trend for both markets?

[SmartCat]

Originally Posted by RedTerrano

I am a total noob when it comes to stock markets. But the graphs seem to indicate a similar upward trend for both markets?

Think of Sensex as a mutual fund with 30 stocks and Nifty as a mutual fund with 50 stocks. The top holdings in both Sensex and Nifty are the same. Not just that, the percentage holdings of each stock is almost similar too. The extra 20 stocks that Nifty has do not carry much weight (in terms of % holding)

So that's why Sensex and Nifty chart will look similar. Correlation between Nifty and Sensex is very close to 1.0

[msdivy]

Originally Posted by RedTerrano

I am a total noob when it comes to stock markets. But the graphs seem to indicate a similar upward trend for both markets?

Originally Posted by SmartCat

Think of Sensex as a mutual fund with 30 stocks and Nifty as a mutual fund with 50 stocks. The top holdings in both Sensex and Nifty are the same. Not just that, the percentage holdings of each stock is almost similar too.

BSE & NIFTY are like 2 sports meet. If the same athletes compete, the tally of medals will be the same.

BTW, it doesn't indicate the health of the economy. Just like the USA, being medal toppers in Olympics and all other sports meet they compete, their average general population is obese and have lifestyle health problems.

[RedTerrano]

Originally Posted by msdivy

BTW, it doesn't indicate the health of the economy. Just like the USA, being medal toppers in Olympics and all other sports meet they compete, their average general population is obese and have lifestyle health problems.

Very apt and concise analogy

But then it also raises the question: Why so much hullabaloo when the markets dip?

[srini1785]

Go Mota bhai Go!!.

SEBI CLEARS RELIANCE - FUTURE 24kCR RETAIL DEAL

https://www.newindianexpress.com/bus...l-2253468.html

All of India is your open supermarket.

At this rate, i wouldn't be surprised by even 75K on Sensex by 2024 ("India Shining" - Anyone remember?). As Warren Buffet once said "Only when the tide goes out do you discover who's been swimming naked".

[avishar]

Originally Posted by msdivy

BSE & NIFTY are like 2 sports meet. If the same athletes compete, the tally of medals will be the same.

BTW, it doesn't indicate the health of the economy. Just like the USA, being medal toppers in Olympics and all other sports meet they compete, their average general population is obese and have lifestyle health problems.

However, looking at the quarterly results, profit growth has been strong which has made some of the P/E ratios remain unchanged (or has even decreased in some cases).

That said, some less than savoury numbers from Bandhan Bank and credit quality concerns seem to have spooked the markets.

[warrioraks]

This is a big bubble. No one knows when it will burst but it will. Let me give a couple of examples:
1. The Whatsapp fiasco recently led to a lot of users migrating to Signal and other apps. This led to stocks of Signal Advanced to go up by 1000%. The problem? Signal Advanced is a penny stock nothing to do with the Signal messaging app. Even after this information came out public, the stock is still trading 10-15 times of its old value.
2. Tata motors share saw a strong rise recently when rumours of it’s tie up with Tesla came to light. Even though TaMo has clarified that these are just rumours, there hasn’t been any pullback seen yet.

Clearly there is too much money and very few opportunities. The only thing to see is, when will this gravy train run it’s course.

[Cessna182]

Gamestop shares rose drastically recently after reddit traders from the wallstreetbets sub bought enmasse to prove a shortseller wrong. This rally might prove similar.

[warrioraks]

One of the better articles from ET on the state of the stock market and why excessive money printing is not working out for world economies like it should have.

Is the Sensex bubble about to burst?https://m.economictimes.com/news/eco...w/80430696.cms

[PearlJam]

Originally Posted by warrioraks

One of the better articles from ET on the state of the stock market and why excessive money printing is not working out for world economies like it should have.

Is the Sensex bubble about to burst?https://m.economictimes.com/news/eco...w/80430696.cms

Articles like "Is the Sensex bubble about to burst?" always makes me cringe.

The market is always forward looking. Nobody in the world will know with certainty, at what point a bubble is reached. Everything is in hindsight. When the bubble does burst, everybody will say "I told you so". Some analysts became famous, because they correctly called out a bubble in the past - but remember that 100s would have also called it out wrongly, and we wouldn't even know about them.

For example, see this article that appeared around 4 months ago, that also speculated about bubble fears:
https://timesofindia.indiatimes.com/...w/78114138.cms

Should we shame that author? Probably not, because media always wants to grab eyeballs, and he is just doing his job.

Bottom line - stick to basics and follow your asset allocation strategy.