Wednesday, October 31, 2007
Indian stock market update as of 1 November 2007
The market seems to be going into ballistic zone, with having touched the all-important 20,000 levels this week. At this point, with the amount of foreign (and domestic) money pouring into the system, there is no telling which way the market will move. There is an incredible amount of money flowing into the market here and that is pushing the market to go up. This places the market at huge risks since such flows are volatile; this is countered by the view that Indian companies and the economy continue to show strong growth and this sentiment will continue to attract money.
By the grace of God, I have held my nerve (some may call it being greedy) and have not yet cashed out, hence stocks have shown good growth. There are tremendous pushes for a correction, and if you just look at the maths, a 1000 point fall, however strong it feels, is a drop of 5% and the Indian market has shown such kinds of volatility. One thing is sure, this is a good time to try and get out of speculative and high risk stocks since they are the first ones to get impacted. And for all the good news about the sensex, many times it seems that the midcaps are under-performing the sensex, so that is also something to be factored in.
Stocks that I am currently tracking:
KLG Systel: Rs. 740
Adhunik Metaliks: Rs. 149
Hindustan Constructions: Rs. 215
Indiabulls Real Estate: Rs. 644
JMC Projects: Rs. 460
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By the grace of God, I have held my nerve (some may call it being greedy) and have not yet cashed out, hence stocks have shown good growth. There are tremendous pushes for a correction, and if you just look at the maths, a 1000 point fall, however strong it feels, is a drop of 5% and the Indian market has shown such kinds of volatility. One thing is sure, this is a good time to try and get out of speculative and high risk stocks since they are the first ones to get impacted. And for all the good news about the sensex, many times it seems that the midcaps are under-performing the sensex, so that is also something to be factored in.
Stocks that I am currently tracking:
KLG Systel: Rs. 740
Adhunik Metaliks: Rs. 149
Hindustan Constructions: Rs. 215
Indiabulls Real Estate: Rs. 644
JMC Projects: Rs. 460
Labels: Equity, FII, India, Liquidity, Stock
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Wednesday, October 17, 2007
India Stock Market Update 17 Oct 2007
Another incredible day. The previous day, on the 16th of October, SEBI issued a draft for discussion that talked about restricting the flow of money into the Indian equity market through Participatory Notes. The proposal was the following:
SEBI had yesterday invited public comments on its proposal to restrict with immediate effect, issuance of PNs in derivative markets by FIIs and their agents. As per the proposals, FIIs and their sub-accounts are required to wind up the current ODI position over 18 months, during which SEBI will review the position from time to time.
Even though this was a proposal and is due for a vote on the 25th of October, it seemed to be that a lot of institutions and foreign funds saw this as a very abrupt move and voted with their feet. The proposal is seen as a move towards cleaning up the funds flow into the country and ensuring that dirty money is reduced. However, as always SEBI likes to release things without notice and that disrupts the whole system. It required an intervention by the Finance Minister to cool the market, and it recovered from 1700 point down to around 340 points down.
A lot of stocks that were fundamentally good, and yet don't have much FII interests did not fall much. Some of the stocks that did well on this day were:
1. Walchandnagar - Rs. 6300 (has gone up massively recently, so approach with caution)
2. Hindustan Construction - Rs. 176
3. Adhunik Metaliks - Rs. 114
4. Grauer & Weil - Rs. 196
5. KLG Systel - Rs. 673
6. Supreme Industries - Rs. 170
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SEBI had yesterday invited public comments on its proposal to restrict with immediate effect, issuance of PNs in derivative markets by FIIs and their agents. As per the proposals, FIIs and their sub-accounts are required to wind up the current ODI position over 18 months, during which SEBI will review the position from time to time.
Even though this was a proposal and is due for a vote on the 25th of October, it seemed to be that a lot of institutions and foreign funds saw this as a very abrupt move and voted with their feet. The proposal is seen as a move towards cleaning up the funds flow into the country and ensuring that dirty money is reduced. However, as always SEBI likes to release things without notice and that disrupts the whole system. It required an intervention by the Finance Minister to cool the market, and it recovered from 1700 point down to around 340 points down.
A lot of stocks that were fundamentally good, and yet don't have much FII interests did not fall much. Some of the stocks that did well on this day were:
1. Walchandnagar - Rs. 6300 (has gone up massively recently, so approach with caution)
2. Hindustan Construction - Rs. 176
3. Adhunik Metaliks - Rs. 114
4. Grauer & Weil - Rs. 196
5. KLG Systel - Rs. 673
6. Supreme Industries - Rs. 170
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Friday, October 05, 2007
India Stock Market Update 05 Oct 2007
What a ride. The last 2 weeks have seen a movement in the market that have defied all pundits, all experts, and thoroughly confused any commentator as well as the retail investor. When the market was heading quickly to 17,000, there were lots of calls that an imminent correction was due, but those faded out as the market made its relentless climb to the 18,000 level. The market is now very close to the 18,000 level and it could take just one or two more days to reach there; however, in the midst of all this rosy feeling, there is the fact that a lot of stocks are not participating in this jump. At the same time, there are junk stocks that operators are starting to push again, and these are the ones that most impact retail operators. They get stuck in these junk stocks and are unable to come out from these.
What is a good course of action ? A strong recommendation is to review the stocks that you may own to evaluate as to how many of them are backed by fundamentals and how many are junk stocks that are climbing high without any apparent reason. Another option in such a heated market is to take out some of the profit that you may have made, and hold it for investing if there is a correction. I say 'if' because no one can predict whether the market will consolidate and rise, or whether there will be a correction. There are now articles appearing in the paper about how this rise is all artificial, and would soon be shaken out. On the other hand, there is an incredible amount of money coming into the market from foreign investors and from domestic mutual funds.
Stocks that I am currently tracking:
1. Shree Ram Mills: Rs. 425
2. TRF: Rs. 1100
3. Hindustan Constructions: Rs. 162
4. Yuken India: Rs. 248
5. Tayo Rolls: Rs. 289
6. Voltas: Rs. 168
7. KLG Systel: Rs. 595
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What is a good course of action ? A strong recommendation is to review the stocks that you may own to evaluate as to how many of them are backed by fundamentals and how many are junk stocks that are climbing high without any apparent reason. Another option in such a heated market is to take out some of the profit that you may have made, and hold it for investing if there is a correction. I say 'if' because no one can predict whether the market will consolidate and rise, or whether there will be a correction. There are now articles appearing in the paper about how this rise is all artificial, and would soon be shaken out. On the other hand, there is an incredible amount of money coming into the market from foreign investors and from domestic mutual funds.
Stocks that I am currently tracking:
1. Shree Ram Mills: Rs. 425
2. TRF: Rs. 1100
3. Hindustan Constructions: Rs. 162
4. Yuken India: Rs. 248
5. Tayo Rolls: Rs. 289
6. Voltas: Rs. 168
7. KLG Systel: Rs. 595
Labels: Equity, Future, India, Stock
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