Friends,
Market again tanked on the back of Lehman brs news.
That is the difference I am seeing between Dow and Sensex.
Dow shruges off the negative and with any good reason goes up while we still are seeing the negatives.Freddie Mac and Fennie Mae were bankrupt and Fed has to bail out and they went from 52 week high of $65 to low of $.65... so was Lehman Brs but the other stocks moves up..while in India it is not so......
But sooner or later we are going to decouple from US syndrom.The latest IIP figures came very good.It showed a growth of 7% and still market ignored them.
The results too are not bad of June qr and I think Sep qr will also be not that bad....
Bears seems hell bent to show us 12000 or even 10000.Now the onus is on Bull how they takes on Bears....any rise is taken as an opportunity to short sell and they are hepled by the selling of FII's like Citi, Lehman Brs....UBS, CLSA, Merill Lynch.. etc......
Well,for the market to come up the FII selling should stopped.....and when that happens is to be seen.
But I still feel that we should see a good upmove before next election is declared.The logical thinking for me is that if market has to tank when the election are declared then it has to go up first before it is declared...so to tank again....but if we are at 12k or 10k level how will it tank?
Let us see how things pans out....but am sure this is not the time to sell even if we are seeing the prices getting eroded....The bottom seems to me nearer and market seems to be taking support at some crucial levels.
As I have written here I would like to again reiterate that we may try to touch the previous high before anything happens......
Crude is at $100, IIP nos coming good,Results not bad,Growth is intact,N Deal on verge of passing....and in last 3 months India is outperforming the BRICS nations ..........
All Russia, Brazil, China are bleeding more then ours....and we are still above the last bottom we made ,Viz: 12500!
Lots of value buys are surfacing and we need to look at it and buy if one have money.
All said and done...These are my views and I may go totally wrong.....Take your own call.......
I feel that we will never be decouled from the US as long as we are in this world. US was economic super power and still it is. As time goes by, it will not remain the economic super power but that also means that there will be more and more inter dependence among world nations. In that way, a failure of such kind (as it is now in US) in any big economic nations like US or Japan or may in india (we are there at that leve then), will have ripple effects. If you look at from some different angle, then it might be clear that inter dependence will be deciding factor in future, be at for the capital or market or worst both. When the share holding of the global companis or becoming global will have cross border, then the prblem becomes global even it is due to local reasons. So I feel if US is failing now, we are affected but if tomorrow India has any problem then others will be effected, the damage will be decided by how much stake they have here.
ReplyDeleteSo in all, I dont think we will reliase this dream ever. It is not about economics, it is about inter dependence. Yo watch the future.
Anoop,
ReplyDeleteSeems you don't understand what I meant to say....
If we are coupled with Dow then why are we so much down?..if we are not decoupled then we should mimic Dow..isn't it?
Dow is not much down from Last July....then why are we down by 30%and more?What you mean by decoupled and what you mean by coupling?Please explain....What happens when one say we are decoupled and when one say we are coupled....
The fact of matter is that the FII's selling is making our markets jittery....and rupee depreciation will make FII turn back to look at our market as they will now be able to buy more as against dollar, rupee is now 45 which was 39 ,6 months back....
the rupee depreciation of 20-25% has helped FII makeup their loss....which they sold here....
Rajeevji,
ReplyDeleteThough I would like to believe in the bullish story unfolding in our stock markets, the signs are very ominous.The US financial tsunami is taking a heavy toll on the Indian markets and from the reports one reads, there are more skeletons in the cup-board. The worst news may yet to come and there are already fears of Citigroup.I dread to think of this becoming a reality and I personally think the Indian markets may not see the highs previously achieved for atleast another year. I think this is not the right time to make new investments nor can one make an exit as the values have eroded considerably. I think we are in for some tough times, but I would love to be proved wrong in this.
Rajeev Ji,
ReplyDeleteI fully support your view.I can quote a very good example for your view.Take today(15th Sep 2008) as an example.Lehman Brother filed for bankruptcy and Merill Lynch was acquired by BOA,even after such a shocking news,DOW was down by just 2% or less than that.
But you see Indian market,except FII selling, all are good news(Inflation down,Oil down,good IIP numbers,moderate quarter results),or market i tanking by 3.5%.What more can be said?
As u said,our market tanks doule the dow everytime it is falling,but when DOW goes up even then our market is not going up.
I dont know why people dont understand your simple view.
Regards,
Sambath
Kalanjiyam,
ReplyDeleteThe dow is effectively 4% down, inline with what sensex and other major markets have lost today.
I hope that it stops here....
Dear ram,
ReplyDeleteYes ,the news that are coming are real ominous and I too am scared to see and hear them.
If one by one US Fin Insti keeps on liquidating themselves then I am afraid how will our market will move up!
Still Morgan, Citi,GS etc may come in next line....
Our market recovery is dependent on how the US Financial Mess is get cured ....and thus the selling by FII get abated anyhow......That is a million dollar ....
Let us see how future unfolds.....
The only ray of hope I am seeing is that our market is not tanking the way it use to tank when a bad news comes out from US or overseas...
Market is igonring all good news like Crude below $95,Inflation staying where it is and maybe will now not go up from hereon etc...so how much the good news can be ignored is to be seen as in our market there is no much room for individual stocks to go down....
But what can be done when FII's are selling?They invested big here and they are in a mess and they needs money.....actually,India is the last country where FII had taken the minimum amt from the market....when it is compared with Russia,China, Korea, Brazil etc.....
Anoop,there is nothing like proving right or wrong..these are all guessing and a logical thinking...anybody can go wrong....and I think this time again there are all chances that I will prove wrong....
As you said that FII are selling like anything and until then we cannot see new highs. Earlier they invested and market went up. So in a way growth story or all that is fine, market can move anywhere provided you have someone who can pump money in the market. That is what I got to undersand. Analsys whether technical or fundamenta can be done but what matters most is the value in the market and whch side of that you are - loss or profit. Hopefuly in a year or so, FII may come out from the current issues and probably by that time, we will have our strong DIIs and they will take the market up. Pensions reforms and others lik that will come into picture.
ReplyDeleteRajeev, these are my thoughts. And I dont have any doubts that you are more knowledgeable than I am, in this area.
I am trying to give a different perspective as most of the visitors tend to agree with you. We should also have disagreements for a good discussion. Please dont my mind my comment.
Thanks and regards,
Anoop
Dear Anoop,
ReplyDeleteI have never tried to act against whose opinion differs with me.
I may have looked harsh in writing but that is the way I write....
Where the reason given were not justified , ofcourse according to me,I have wrote my view there....
Yes,it is true that FII selling is unabated but the sliver lining here is that ...we are not going down as much as we use to....like when Bear Stren cracked we were almost 1k down an Lehman figure is much much bigger then Bear Stern and still we tanked the 1st day and remained static the next day,Tues....
even Dow is showing strength ...as it should have been down by again 500 points today but that has not happened...
Moreover DII is absorbing all the selling that is coming from FIIs and hence we are still not at 12500 the previous low....
But one thing is clear from this and that our market is not tanking on Fundamentals but on FII distress and compulsive selling for the reason we all know....
DII are flush with funds and I read today in ET that Lehman br in India were selling futures since long and they have stopped it from Monday....
But all marks to DII who has stood straight in this turmoils and paving ways to those FIIs who wants to quit India .....that is a great situation....
But the bottomline is very clear....India story is still intact...see the Advance Tax figures which has come out...and you will know all....
Dear Mr Anoop,
ReplyDeleteI totally agree with you that there should be some dis-agreements about any discussion.
I think that we are not mere a toy of FIIs , like when they buy our market rose and when they sell we fall like anything. Time has come for our DIIs to play ample role in our market. I agree with you that crisis in US financial market will have a major effect on our markets but that it limited to a certain extent. When Crude was rising our market our dala-street witnessed blood-bath and when now it is calming down still blood-bath is going on. i think reason is The rise of the dollar against the rupee has almost nullified the fall in Crude Oil price.
In my views such bankruptcies IN THE us financial world are good to happen, in the sense that BAD News is finally now OPEN to world. earlier everything was hiding from the world.
I am not able to comment on the STATE of Market in next Few Months but i am optimistic that our domestic growth will remain intact.
I also run a small blog to help small investors. If you want to visit my blog then you are welcome at www.bsensediamonds.blogspot.com
Regards,
Deepak
rajeevji,
ReplyDeletethough most of ur readers claim to be investors many of them are indeed traders. so here is a good peice for traders. U may like to put it on front page if deem it fit.
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HABITS OF HIGHLY PROFITABLE TRADERS
Habit #1: Trade only with risk capital.
Many people start trading with money they can ill afford to lose. We call it “scared money.” That way, the fear of loss far exceeds any desire for gain, and they trade in a state of nervousness and anxiety. A set-up for failure from the get-go. The proper way to start out with your trading is to determine how much you can comfortably afford to lose financially, and then, from that amount, determine how much money you can afford to lose emotionally. Financially allocating an amount of money for risk capital is very much different from emotionally allocating it. Anything can and will happen in the market. Develop the habit of only trading with money you can afford to lose financially and emotionally.
Habit #2: Accept full responsibility for your own trades.
Successful traders always take full responsibility for their own actions in all aspects of their lives, and when it comes to trading they're no different. In today's day and age it 's easier and more convenient to blame others for our actions or to lie to ourselves. There are many examples of people not wanting to fess up, and take responsibility for what they do. Successful traders realize that their success or failure is all their own. While it may be convenient to blame the specialist for screwing them on an execution, or blame the day trading stock pick tips service for a string of bad picks, the ultimate responsibility for their actions falls directly on their shoulders, and they know it. You can learn a lot from an experienced trader, but your results are the result of your actions.
Habit #3: Focus on one or two techniques that Work.
Rather than constantly searching for new strategies and techniques, the profitable trader will consistently apply one or two approaches and absolutely nothing else. New traders often get in the habit of constantly searching for new things to try before they've even executed one trade with a proven strategy they've read about somewhere. They buy someone's book, then another, and yet another before they end up with a dozen books on trading without having performed a single trade. Or, they'll trade stocks, then switch to currencies, then switch to commodities, then something else. And so it goes. Most professional traders use only one or two techniques at most - and nothing else. Some days are better than others for them, which is true of all trading, but at no time do they even remotely consider trying something else. Even the most average of techniques, when executed with focus, will yield better results than the technique-du-jour if you're changing styles every week. Find a system that works and work that system to death. The grass isn't greener on the other side of the fence. It might just be moss. Learn your market, refine your personal approach to it and stick to it. Period. End of discussion.
Habit # 4: Properly manage your trades.
Without exception, every trading author on the face of this earth says that cutting losses is one of their "cardinal rules" of trading. But, if you've ever traded, you know how your own mind can work against you when it comes time to sell at a loss. You 'll start rationalizing why you shouldn't sell. "It will come back for sure." "It's just a temporary setback." "I'll sell when it comes back to the price I paid." I’m sure you’ve heard it all before – you talking to yourself about that trade that’s gone wrong. Take your pick of excuses, but none of them are the right way to think, and the next thing you know you've got a nightmare loss on your hands. Everyone has had this happen to them in the learning stages. Successful traders identify their profit and loss parameters before they enter a trade. They set their stops and stick to their parameters.
Habit # 5: Stay emotionally neutral.
Successful traders don't get too high when they have a winning day, and they don't get too low when they have a losing day. Taking a loss is as much a part of trading as is taking a gain. The difference is in how you emotionally deal with the losses and the gains. The market goes up and down constantly, but successful traders don't come home and kick the dog after a bad day in the stock market, or any of the markets they’re trading for that matter. Nor do they rush out and buy a new BMW after they’ve had a good day, although there is that temptation. Take it from one who knows – and owns a BMW. Successful traders don't let the stock market, or any of the other markets, put them on an emotional roller coaster ride. Staying emotionally neutral is the key to long term trading success. New traders often experience "burn out", which is more a result of emotional ups and downs than anything else. Don't buy into the hype that is constantly coming out of Wall Street. Don't get scared when the market drops or pop the champagne when it roars higher. Just trade it. Save your emotions for the things that really matter in life like family and friends, not trading. Well, you can get a little excited about the BMW. After all, there are rewards in life. But, you get the point.
Habit # 6: Trade without certainty.
Successful traders are comfortable with risk. They know that they can't always wait for certainty that the trade will be profitable before they do the trade. They trade in anticipation of a pattern or event. This mindset is extremely difficult for new traders. New traders want all the facts before they do a trade, and by the time all the facts are in the trading opportunity is long gone. Then, they finally get around to putting the trade on and end up sitting there wondering why it didn't work out. If you're going into town and you need every traffic light to turn green before you leave, you'll never get out of the garage. Accept the fact that you won't have advance proof that a trade will work. Get comfortable with risk and learn how to manage it.
Habit # 7: Keep a trade journal.
Successful traders keep a trade journal of their trades, and periodically review it as a way of refining their approach to the stock market, or whatever market they’re trading. There is a tremendous amount of valuable information in your losing trades. Sometimes, you can spot easily identifiable patterns in your losing trades that can be eliminated. When reviewing their trade journals, successful traders don't think of them as profits and losses, but simply results. Just because you have a loss doesn't make you a loser, and just because you have a winning trade doesn't make you a winner. Successful traders use their trade journal to learn about themselves in an objective way. They realize that their trading activities produce results, and that the results hold valuable information about themselves. They offer the keys to improving the results of their activities. Keep good notes on each trade and review your notes often. It will help you trade better."
FED has moved to the rescue of AIG. It is reported that the total bail-out effected by FED is to the tune of USD 900 bn. So much for free economy and free enterprise. FED is rewarding for the financial excesses and indiscipline of these financial institutions.The s0-called communist China is more of a free economy in the sense of foreign participation in the growth of the economy and the very capitalist US has taken the role of government intervention and protection.
ReplyDeleterajeevji,
ReplyDeleteAs I have opined a few times i feel we have a few months to reach the bear market lows. I have one rquest for u which u r very good at--- as of now the list of ur recommended stocks are just too many. May we request u to have a relook at all of them ( and also any other) and short list 10-15 stocks that are in ur opinion the very best of ur recommendations. we also request u to have a look at some beaten down big caps as they will be the ones which will be the first movers when the bull market starts. look i am the incurable optimist, already talking abt a bull market!!
Dear Azad,
ReplyDeleteI will try to trim down the list and also will look at the bigcap as they should be the front runner next time.....
But we need to see when the unabted selling of FIIs get stopped.
If we are going to be below 10k then there is still big room for the stocks to go down....
Seems the worries in US Financial Market is going on and on and no respite is seen as of now...how many skeleton is left in the cupboard no one knows.....
But sure will write about what u have asked sometimes.I think we have enough time left to think on that as we will not be going up too soon...
Dear raju bhai
ReplyDeleteThats very much true the omnious signs of bear market are catching up,looks we are heading towards,12500,11300,9500 in worst come scenerios,jan 09 looks stable period,for a good stady upmove
Its a fact that we are a growing country and our domestic consumption,fII coming back like never before,pension reforms,easy rbi norms for liquidity will bring back the sensex post august 2009 to good levels,staggered buying in rajeev desais stocks is the mantra,as bottom fishing as started.