After the bull run, the economy is slackening due to a real lack of investment spurt except in the corporate sector. For two and a half years, the share market has witnessed a bull run such as the country has never experienced before. When it began, shortly after the first sale of the shares of Maruti Udyog,in May 2003, the SENSEX had been hovering around the 3000 mark for months. On Friday it was over 9400. Almost anyone who was in the share market in June 2003 has seen his savings trebled. Those who have invested their money wisely, are now five times as well off as they were 30 months ago. This is despite every vicissitude save war. But in the past five weeks the SENSEX has stabilised at a little over 9200. Spurts as high as 9800 have been followed by profit taking that has fully neutralised the increase.

So is the bull run to beat all bull runs coming to an end ? The signs are multiplying that it is. While there is absolutely no reason to believe that share prices will fall significantly in 2006, the hectic growth of the past 30 months has almost certainly come to an end.

The immediate reason to expect prices to stay on a plateau is an imminent rise in interest rates. The RBI ...

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