The markets took the much required support at the 3850 level and the efforts of bulls being respected in placing the Nifty above 4000 level.
The markets are at confusion about the future whether India can out perform at the Global competition as the environment was changed due to the high crude prices and inflation. To add fuel to the fire the local political situation is also very bad even though everybody is trying to pose a brave face while facing the camera.
Whether it is Dr Kalam or Dr Manmohan who recommends the N-deal but the changed economic compulsions forcing us to sign on the deal to safe guard the energy security to the nation. The markets live with short sighted policies, the political compulsions and competitiveness of the economy to excel in future. The perceived robust growth of economy is intact inspite of the above discussed problems.
The monsoon is so far good but the high input cost is becoming an expensive investment at the agriculture level. The farmers are no longer attached to the tag that they need to cultivate and produce food for the rest but they are equating as investment and return.
The first quarter (Mar-June) results and the industry views on the demand supply side at their level will decide the future course of direction of the Nifty.The RBI governs work became very tough to deal with the inflation as limited tools left at his disposal to dealt with the situation. The crude oil price fall can infuse strength to emerging economies like India. The situation will ease as things stand at this point in time. The other challenge is the Rain God’s blessings to India.
The external and the limited controllable situations are controlling the Nifty direction at this point in time. The time will ease things and the turmoil will melt down and the confusion dust will settle down by Sep-08 but the fog of parliament elections will again put speed breaks to the upward Journey of Nifty in 2008.
So all around existing confusion will lay down heavy burden on the shoulders of the Bulls even though the macro and micro economic conditions look bright for the long-term journey ahead.
Saturday, July 05, 2008
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1 comment:
I think what drives the market is liquidity, weather money casing the stocks or the other way ,stocks chasing money.
Every bull market mother's milk is the easy availability of credit at reasonable cost.When the FD is likely gives handsome anual returns there may be spread of risk avertion psyche.I for me have seen bluest of blue chips going for petty valuations when the liquidity is tight and even rogue stocks commanding astronical valuations when the liquidity is in deluge. So only time can tell where the markets are headed,not human beings.
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