Prevailing economic conditions, both domestic and global, suggest the Indian stock market is poised to continue to rally in 2010, increasing the risk that a bubble is forming, according to analysts at research-led investment bank Noble Group.
The first factor supporting a stock market rally is strong GDP growth of around 8%. In the last quarter, we saw that the GDP growth was 7.9%, so it's almost there, said Dipankar Mitra, Noble's lead India analyst for economic and country research. This is making global investors excited about India and confident that the structural growth of the economy remains quite strong.
The second factor is a pickup in the investment cycle. So far, the...
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