Apurva Sheth, Head of Market Perspectives & Research, SAMCO Securities says Nifty has enough room for further expansion especially given that we are entering an election year, the room for upside is wide open.

“Nifty crossed the psychologically important mark of 20,000 points on September 11. With a breach of this important resistance level, we believe that the next target to look forward to in Nifty is 21,500, which is 3,000 points from the main breakout level of 18,500. Despite the markets hitting new all-time high the valuations are still reasonable. Nifty’s trailing twelve months PE is at 22.39 which is slightly above its long-term median of 20.62,” he says.

According to Sheth, it is notable that the sectors which pushed the Nifty up till 20,000 may not be the same which will push it to 21,500. “Nifty may have hit an all-time high but not all the sectoral indices have followed it... Bank Nifty is also trading at a relatively cheap valuation. Thus, Banks and IT could be the sectors which may take the index higher from the current level.”

Rupak De, Senior Technical analyst at LKP Securities, says the market sentiment is expected to remain upbeat as long as the Nifty stays above the 19,900 level. “On the upside, we can identify an immediate resistance zone between 20,100 and 20,200. If there is a convincing breakthrough above 20,200, it could pave the way for the Nifty to advance towards the 20,500 mark."

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Nifty hits 20,000-mark; 21,000 by Diwali? Here’s what analysts say