It seems that the bulls are back on the Dalal Street.

It was the first time on Thursday the broad-based Nifty of the National Stock Exchange touched the 5000 mark in 16 months clocking gains of 90 per cent from the lows seen in March this year.

The Nifty pared some early gains to end flat after hitting 5,003 at its day’s high. The global markets have been supportive too, thus, providing necessary sentiment to drive indices to a new high.

European and Asian stock markets hit new highs for the year on Thursday as investors became increasingly confident that the US economy is is growing again. Germany's DAX rose 0.4 per cent to 5,722.16, Britain's FTSE 100 gained 0.6 per cent to 5,154.58 and France's CAC-40 increased 0.3 per cent to 3,826.32.

“If Dow goes up by 50 points, Sensex goes up by 500 points. The correlation is illusionary. It clearly indicates that India is outperforming the western world,” said renowned trader and investor Rakesh Jhunjhunwala.

Realty and metal stocks have been on fire, jumping over 200 per cent from the low in March. Eight of the 50 Nifty stocks have contributed 45 per cent of Nifty gains.

The pace of the rally has left some experts convinced that the rally will lose steam soon.

“There is huge run up in emerging markets mainly India. My advise is book your profits and sit on cash, run up has been too steep,” said Aditya Samant, partner at Black Swan Capital.