Early this year, the Sensex surprised analysts and experts by crossing the psychological 10000 points barrier. Immediately, the smart operators who had been predicting a "sharp correction" for some time came out with their reasoning. They said that apart from the fundamentals of the economy and encouraging corporate results it was the liquidity surplus, or huge sums available with foreign and domestic investors, which was pushing up prices. That's why, they reasoned, almost every scrip was going up. Abhay Aima, head of equity, HDFC, felt it was a market being "driven by momentum".
A long-awaited correction in May this year halted the run and the Sensex crashed by over 3600 points to nearly 9000 within a month. Yet again, the experts predicted that the Sensex is going to be "range-bound", or move within a certain fixed band, for the rest of the year. They said that liquidity was drying, stock valuations in India and other emerging markets were too high, the US interest rates had gone up, and most central banks were trying to check skyrocketing asset prices. Therefore, there were no immediate factors to prompt another bull run.