Sunday, July 22, 2007


India stock market update 22 July 2007

The stock market shows no sign of letting up, driven by a global liquidity charge and further driven by the promise of a continued high growth rate. So, even though we see corrections, the market remains on the promise of a continued growth, to reach 16,000 sometime this year. However, with the volatility of the market being what it is, a correction can happen anytime. The big question is about the extent of the correction. If it is a small correction of some few hundreds, then it will be shrugged off. However, we have seen in the past that slightly major corrections see analysts jump on the doom and gloom platform and quickly target 3000-4000 point corrections.
What am I doing ? I am reviewing my stocks to identify those that are slightly junk, or not based on fundamentals and liquidate them. I am also encouraging family members to diversify funds towards fixed deposits, getting 10% is not such a bad deal for some amount of money. Also putting money in my regular Mutual Funds such as HDFC Prudence, Franklin Flexicap, SBI Magnum, SBI Taxgain, and Reliance Equity Opportunities Fund.
Am I putting fresh money into the market? Yes, I am. I have a long term belief in the market, and as long as I am convinced in the fundamentals of the stocks that I am investing in, then I will continue to put money. I was reading some more about Reliance's quest for further oil and gas in the blocks that it holds for exploration, and it may make sense to continue investing in Reliance for the long term. The problem with Reliance is that it is very difficult to think in terms of selling the stock.
Stocks that I am currently tracking:
1. GSFC: Rs. 205
2. Era Constructions: Rs. 540 (with some care)
3. Schrader Duncan (ICICI Direct code SSDUNC): Rs. 309
4. Garnet Constructions: Rs. 58
5. Voltas: Rs. 150

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