At 4,000-plus the sustainability of the markets and the FII inflows came into question prominently among a cross-section of brokers and fund managers who spoke to The Financial Express.

The consensus: As the election run-up gains momentum, the market is bound to unwind. The index is sustainable at around current levels for about a month was the general perception of the market. ``As we near the elections the political equations could make the investor pull back and book profits,'' points out Simon Holdsworth, managing director and chief investment officer at ITC Threadneedle AMC. The amount of correction in the markets will depend on the fact that in the period to polls there would not be any policy changes and pre- and post-polls the market will depend on the policies framed by thenew Government, he adds.

``We cannot afford to ignore the political factor,'' cautions Ambareesh Baliga of Kotak Securities. The market might have forgotten the political uncertainty due to the euphoria. ``But various polls have revealed that we may have a hung parliament. As the election date approaches, it is bound to disturb investors,'' says Baliga who sets an immediate target of 4,250 for the index.

``This, however, should fall to 3,650 in the next three months on account of profit booking and huge supplies coming in at these levels.'' What happens to the market once the FIIs stop buying at current levels, is the crucial question Baliga poses. A cool off in the next three months with index touching 4,200 levels followed by a correction pulling the index down to 3,500-3,600 levels, seems to be the answer from Dheeraj Agarwal director of SSKI.

K Ranjeet, assistant vice-president, Kotak Mahindra AMC draws attention to the sudden and volatile nature of the rally raising doubts about itssustainability. "There is a huge lot of liquidity in the markets with the FIIs buying being delivery based. There is definitely a huge amount of buying and this is also in 5-10 selected stocks which have a high weightage in the index.'' Sangeeta Purshottam of SG Asia Securities feels that the short-term target of 4,000 has been met. ``We are reaching the end of the bull run. If the index goes beyond these levels it is a sufficient signal that the market is headed towards trouble.''

Saumil Trivedi of Dilvikas Finance is however bullish. He sees the index touching 4,300 points and ``within next 3 months it should touch 4,650 points.'' Reliance will prove to be the torch bearer of the market as it has entered the bull grip. At 4,300 levels we should see Reliance quoting at 215-220 levels and beyond that it should further consolidate at 250-280 levels, he adds. Ramesh S Damani, BSE broker, however, questions the sustainability based on select stocks. ``The breadth of the market has to be broadbased or else apinnacle would be formed which in the absence of support could collapse. The buying has been centred around those counters where FIIs have shown buying interest. The rally has yet not reached out to the cash group which is a must for the sustenance of this rally.''

Malay Sameer, assistant vice-president, Apple Mutual Fund, who expects the market momentum to continue, anticipates profit-booking at 4,270 levels ``in view of the uncertainty that will prevail during election time.''

RG Sharma, CEO, LIC Mutual Fund says: ``Three months down the line the kind of political equations that would emerge would rule the market. The political weakness would catch up with the market and would be detrimental to its health." Amit Shah of Triumph International Finance however expects institutions to book profit as the Sensex touches the 4,500-mark in a months time. Shyam Bhat, Fund Manager, Tata Mutual Fund:"FIIs are restricted to keep 7-8 per cent of the portfolio in cash and beyond that they have to compulsorily invest.With the FIIs sitting on surplus cash due to a booming US market the emerging markets are coming up as a good investment avenue.

The FIIs are left with no chice but to put in money and importantly the India dedicated funds cannot put their money anywhere else. So the funds flow will continue as India is offering better relative returns compared to the valuations in the SE Asian markets. Deven R Choksey, managing director of Kisan Ratilal Choksey expects selective stock picking to come into play as the markets are likely to remain in the current range during May and June. ``With the elections round the corner the market will depend on the political equations.''