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The Economic Times - - Companies: Pursuit Of Profit -

far from peak­ing

mod­ity in­dex nearly tripled from 2001 to 2008, to 240 lev­els. The in­dex is at 84 now, near the lower lev­els of the past 20 years. Lower com­mod­ity prices, par­tic­u­larly of steel and coal, should aid Capex de­ci­sion mak­ing.

DO­MES­TIC LIQ­UID­ITY

The pre­vi­ous rally was dom­i­nated by over­seas cash, which en­ters and ex­its quickly and can be short­term in na­ture. By con­trast, the re­cent rally is ex­pected to last longer as it is lo­cally driven, and any sig­nif­i­cant dip is likely to be bought into. The Nifty, for in­stance, has not cor­rected more than 5% in the last 231 trad­ing ses­sions. In 2007, DII flows were around 30% of the FII flows, while the equa­tions has re­versed now. FIIs flows in the cur­rent year to date are 40% of the DII flows.

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