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Experts expect the rally to continue going forward, but volatility may increase as we are moving closer to state and general elections
The northward journey that started in July, following sideways movement in the April-June quarter (after a correction in February and March) continued in August, helping benchmark indices scale fresh highs.

In line to better-than-expected earnings, stability in crude oil prices, sustained domestic inflows and easing trade war tensions after renewed talks between the US and China boosted investor sentiment.
In the last two months, benchmark indices rallied 8 percent. The BSE Midcap and Smallcap indices rose 7 percent and nearly 6 percent, respectively, though the year-to-date performance of all these indices is mixed. The Sensex climbed over 12 percent and Nifty nearly 10 percent, but the midcap and smallcap indices lost 7 percent and 12 percent, respectively.
Experts see the rally continuing going forward, but the volatility may also increase as we are move closer to states and general elections.
If the September quarter earnings,  which will begin in October, improve further, then the market may see new highs, experts said, adding that any sharp selling could be because of global reasons and not domestic.
Analysis of the Q1 FY19 results indicate that an earnings recovery, which we were expecting in the current and next financial year, is on track. So far, results have largely been in line or better-than-market expectations," ICICI Direct Research said.
Overall, the research house maintained its optimistic outlook on the equity market. "With the forecast of normal monsoons and firm rural demand, amid a pick-up in industrial activity, we expect the Sensex to be on track to stage an impressive earnings recovery, growing in excess of 20 percent CAGR in FY18-20e."
Inflows into domestic mutual funds remained strong despite some moderation in the last few months. Average monthly inflows into equity oriented funds, including the equity component of balanced funds in the first four months of FY19, is around Rs 14,000 crore. The same during the four months of FY18 was Rs 21,500 crore. Inflows from systematic investment plans have seen a consistent rise and stood at Rs 7,500 crore in July.
The outlook for the company remains strong for the upcoming years, backed by the aggressive expansion plans taken up by the company in the past few years and positive market condition. The diversified business model of the company shields the companies earnings from any unfavourable situation.