The history has never recorded any person win against the market with high fighting skills but just try to float while sailing.
The markets are enjoying the best days of Bull Market with euphoric support to the Indian equities. The markets steeply corrected at one point in time but recovered with the RIL up move. The huge civilization and the triumphant bull move scaling the valuations up on every day without break from the breakout from a low of 1921 to 2426 to date. The other counters are also making surprises to every body as the breakout with 30-40 % in two days that to in F&O scrips.
The Bears could exert aborted pressure in the early trade, failed to maintain through out the day. To some extent, some counters in reality sector, banks and power made some backward move. The real test to Bulls will be after expiry as the valuations were too stretched to carry along the October.
The GMR Infra del.(at 786/-) suggested can be booked tomorrow.
Tuesday, September 25, 2007
Monday, September 24, 2007
Settle the Scores……Valuations next!
The “Bulls and Bears” fight at the streets intensified and may lead to a disaster. The company’s valuations are based on the earnings and the future performance with a projection. But now the wild spree has become so wild that may harm the small investor- the real backbone of the stock market.
The polarization of the investment groups supporting a few companies or a sector will create grudge on the operating group either it could be the FIIs or MFs. However great potential a company/ industry has that can deliver better results but it is only an assumption and assumptions can go wrong at any point in future. For whose sake the run –up in the markets when it was absent a few days back. There was no real change in the companies earning or in the economy.
The Nifty was closed at 4494 on last Monday and today closed at 4932. The sub- prime issue was not resolved, it is simply 50 basis points cut can’t bring so much of money to our markets at this astronomical prices, then for whose sake "We are celebrating at our bourses".
Do we mean that the FIIs do not have calculators or do not know how to calculate the valuations and blindly buy at the price that is offered?.
Any way the old adage is always right- “Buy Low- Sell High”.
The polarization of the investment groups supporting a few companies or a sector will create grudge on the operating group either it could be the FIIs or MFs. However great potential a company/ industry has that can deliver better results but it is only an assumption and assumptions can go wrong at any point in future. For whose sake the run –up in the markets when it was absent a few days back. There was no real change in the companies earning or in the economy.
The Nifty was closed at 4494 on last Monday and today closed at 4932. The sub- prime issue was not resolved, it is simply 50 basis points cut can’t bring so much of money to our markets at this astronomical prices, then for whose sake "We are celebrating at our bourses".
Do we mean that the FIIs do not have calculators or do not know how to calculate the valuations and blindly buy at the price that is offered?.
Any way the old adage is always right- “Buy Low- Sell High”.
Wait...."Bulls and even Bears"?
The ardent Bears love to sell at high but the Bulls are also eagerly waiting to trap and make more money while the market is shining in bull grip with media attention. A classic example of RNRL and RPL moves on Friday.
The momentum favours the bulls at this point in time. So those who are long in the Nifty and the other stocks can wait till the nifty trades below the 4785 level. In case tomorrow Nifty fails to trade above 4821 level and the high could not cross 4863-69 level then prefer shorts with stop at 4876-78 level. For investors the suggestion is to buy on declines in Idea, Zeel, and VSNL as investment purpose. The Wipro, HCL tech and TCS in software, in pharma – Ranbaxy, Dr Reddy and Biocon are calls adopting KOI principle (Keep On Investing…. already suggested for ITC at 168-170 range in July).
The Day traders can find opportunities to short in the reality sector but maintain GMR Infra Del. suggested with a stop of 786/- at the acquisition price. The weakest among the Nifty are metals- Tata Steel weak below 748-49 level, Sail weak below 195/- level, Ster weak below 696 levels.
The momentum favours the bulls at this point in time. So those who are long in the Nifty and the other stocks can wait till the nifty trades below the 4785 level. In case tomorrow Nifty fails to trade above 4821 level and the high could not cross 4863-69 level then prefer shorts with stop at 4876-78 level. For investors the suggestion is to buy on declines in Idea, Zeel, and VSNL as investment purpose. The Wipro, HCL tech and TCS in software, in pharma – Ranbaxy, Dr Reddy and Biocon are calls adopting KOI principle (Keep On Investing…. already suggested for ITC at 168-170 range in July).
The Day traders can find opportunities to short in the reality sector but maintain GMR Infra Del. suggested with a stop of 786/- at the acquisition price. The weakest among the Nifty are metals- Tata Steel weak below 748-49 level, Sail weak below 195/- level, Ster weak below 696 levels.
Wait....Bulls and even Bears?
The momentum favours the bulls at this point in time .So those who are long in the Nifty and the other stocks can wait till the nifty trades below the 4785 level. In case tomorrow Nifty fails to trade above 4821 level and the high could not cross 4863-69 level then prefer shorts with stop at 4876-78 level. For investor buy on declines in Idea, Zeel, and VSNL as investment pupose. The Wipro, HCL tech and TCS in software, in pharma – Ranbaxy, Dr Reddy and Biocon are calls adopting KOI principle (Keep On Investing…. already suggested for ITC at 168-170 range in July).
The Day traders can find opportunities to short in the reality sector but maintain GMR Infra Del. suggested with a stop of 786/- at the acquisition price.
The weakest among the Nifty are metals- Tata Steel weak below 748-49 level, Sail weak below 195/- level, Ster weak below 696 levels.
The Day traders can find opportunities to short in the reality sector but maintain GMR Infra Del. suggested with a stop of 786/- at the acquisition price.
The weakest among the Nifty are metals- Tata Steel weak below 748-49 level, Sail weak below 195/- level, Ster weak below 696 levels.
Sunday, September 23, 2007
The re-rating in the offing……..
The markets are "re-rating the stock valuations" time and again and every time . This time also no exception to re-rate the stocks to make some are as “Market Darlings” and some are “Destitutes”. The history through some light on the market movements and the market participants understand the need to observe the change in the CHOICE.
The political developments, economy and the business environment will influence the price movements. Now the situation for the telecom industry in now a place for fierce competition and the new players (a beeline queue for licenses) are threatening the market share of the existing players. Now the top two players Bharti and RCOM are fully valued at this point in time. The Idea has some room left for price appreciation but the others will survive with +5 % up side and – 20 to 25% on down side.
The power sector also reached a stage where there are more proposals than the start up of work at the ground. The construction work will take 3-4 years for each project and the prices zoomed on the hopes of applications and approvals. In India, the bureaucratic hurdles and political mileage of the oppositions in encouraging a protest is clearly visible in POSCO and Mittal Steel projects. The SEZ policy was well written on the papers than on the implementation. So beware of the negative news that favours the bears.
Now the momentum is in favour of the bulls and likely to stay till the expiry. The fresh buying in the hot stocks of today can become monuments for future.
Try to identify those stocks that can yield better margins in their balance sheets rather than following the trend assuming that it will continue in future also. Just recollect the fate of Sugar industry and remember the fate of Softwares.
"Think differently" doesn’t mean to be eccentric. Try to analyse the history, understand the present and Act for the Future. Good Luck.
The political developments, economy and the business environment will influence the price movements. Now the situation for the telecom industry in now a place for fierce competition and the new players (a beeline queue for licenses) are threatening the market share of the existing players. Now the top two players Bharti and RCOM are fully valued at this point in time. The Idea has some room left for price appreciation but the others will survive with +5 % up side and – 20 to 25% on down side.
The power sector also reached a stage where there are more proposals than the start up of work at the ground. The construction work will take 3-4 years for each project and the prices zoomed on the hopes of applications and approvals. In India, the bureaucratic hurdles and political mileage of the oppositions in encouraging a protest is clearly visible in POSCO and Mittal Steel projects. The SEZ policy was well written on the papers than on the implementation. So beware of the negative news that favours the bears.
Now the momentum is in favour of the bulls and likely to stay till the expiry. The fresh buying in the hot stocks of today can become monuments for future.
Try to identify those stocks that can yield better margins in their balance sheets rather than following the trend assuming that it will continue in future also. Just recollect the fate of Sugar industry and remember the fate of Softwares.
"Think differently" doesn’t mean to be eccentric. Try to analyse the history, understand the present and Act for the Future. Good Luck.
THE MOVE BEYOND…………
The markets made a blow out move after crossing the all time high at 4640 level- a nonstop journey to 4850. The word of caution at this point is the markets move up but with selective scrips participating the move. When we compare the scrips performance with the Nifty from the previous high to this level, there are very few stocks that advanced, but the Nifty crossed the high with “The RELIANCE group”. The Ambanis only enjoyed- as a matter of fact it could be the real cause of worry. A negative thinking can pose a question that “Is this group that represents the whole economy?”. If your answer is ‘Big No’ then there is something cooking.
But the other side of the story is colourful when we consider the past experience of the FIIs. In the global melt down that happened last year, the FIIs were trapped in the illiquid counters. The bitter experience due to illiquid counters and small companies kept them away from choosing them. The same story continued with the case of Sugar stocks, tea stocks and the other commodity & under performing sectors. The lessons learnt are costly and nightmare haunts them till date. So they are focusing and patronizing those groups that assure them consistent returns.
The FIIs are pumping money in the hot sectors with sound management. In the same energy sector, ONGC is kneeling down at RIL, REL is a high fly where as the NTPC, CESC and other power companies seeking fund support. The RCOM is jubilant where as the other MTNL and VSNL are surviving. The RNRL and RIIL are zooming where as others scouting for buyers.
The story is as simple as that- the real test for INDIAN stock market is the domestic FIs, the MFs and the venture capital funds shall come forward to encourage the best management groups to flourish along with the investors.
But the other side of the story is colourful when we consider the past experience of the FIIs. In the global melt down that happened last year, the FIIs were trapped in the illiquid counters. The bitter experience due to illiquid counters and small companies kept them away from choosing them. The same story continued with the case of Sugar stocks, tea stocks and the other commodity & under performing sectors. The lessons learnt are costly and nightmare haunts them till date. So they are focusing and patronizing those groups that assure them consistent returns.
The FIIs are pumping money in the hot sectors with sound management. In the same energy sector, ONGC is kneeling down at RIL, REL is a high fly where as the NTPC, CESC and other power companies seeking fund support. The RCOM is jubilant where as the other MTNL and VSNL are surviving. The RNRL and RIIL are zooming where as others scouting for buyers.
The story is as simple as that- the real test for INDIAN stock market is the domestic FIs, the MFs and the venture capital funds shall come forward to encourage the best management groups to flourish along with the investors.
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