Sunday, January 20, 2008
India stock market update 21 January 2008
As I write this, the Indian stock market has seen a decent correction (some would call it drastic). The sensex has fallen around 3000 points in around 2 weeks, which is a significant fall, but the severity of intra-day falls has been worrisome, and especially the weakness shown in the last 1-2 hours of trading. What typically happens is that the market does a bit of up or down, and may have been actually up till around 2 PM, and then a severe bit correction happens where the market may swing by around 200 points down. If you see a graph of the day's movements, then the sharpness of the line is visible.
There seem to be multiple reasons propounded for this drop:
1. The markets have gone up tremendously over the past few months, and a correction seemed imminent
2. The immense IPO of Anil Ambani's Reliance Power pulled in a huge amount of money from the market and decreased to a large extent the liquidity available in the system
3. The sub-prime crisis has been hitting Financial Institutions the world over pretty badly, with many of the US based ones showing heavy losses. In such cases, they have been selling in order to get some money back and improve their financials.
Currently, I am just sitting tight, not investing more money other than looking at what I own currently, since I am not sure about when the recovery will happen.
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There seem to be multiple reasons propounded for this drop:
1. The markets have gone up tremendously over the past few months, and a correction seemed imminent
2. The immense IPO of Anil Ambani's Reliance Power pulled in a huge amount of money from the market and decreased to a large extent the liquidity available in the system
3. The sub-prime crisis has been hitting Financial Institutions the world over pretty badly, with many of the US based ones showing heavy losses. In such cases, they have been selling in order to get some money back and improve their financials.
Currently, I am just sitting tight, not investing more money other than looking at what I own currently, since I am not sure about when the recovery will happen.
Labels: Equity, Future, India, Stock, US
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Monday, January 07, 2008
India stock market update 08 January 2008
Today, the sensex touched 21,000 for a brief time, and then pulled back. Overall, the market has moved up on a fairly consistent pace, with many times, the large caps moving up faster, and many other times, the mid caps move faster. For the last several weeks, a worrying trend has again emerged, with many small caps and penny scripts moving up. Sometimes they may jump up several-fold in the matter of a few days, and is normally a sign that things are coming to a head and may decline soon after.
And so it happened today. One does not know whether it is a 1-day blip, or whether this is a sign to come. For some time now, most financial analysts are claiming that markets have risen up too much too fast, and the Indian market is fairly expensive now. Today saw a steep fall of the mid-cap and small-cap stocks. No one who was watching stocks today could have failed to notice the depth of the fall; officially it is 3.54%, but it feels more in the range of around 5% (depends on the scripts owned, I guess).
As always, be very careful when investing in penny stocks; they can be extremely risky, and even a tip from a place seemingly very safe could be just based on a rumour. There can be a lot of money to be made from small-cap stocks, but money can get lost pretty quickly also, hence be careful.
Stocks that I am currently tracking:
1. Reliance Ind: Rs. 3054
2. Yuken India: Rs 348
3. Supreme Industries: Rs. 350
4. TRF: Rs. 1956
5. P G Foils: Rs. 118
6. Patel Airtemp: Rs. 132
7. JMC Projects: Rs. 500
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And so it happened today. One does not know whether it is a 1-day blip, or whether this is a sign to come. For some time now, most financial analysts are claiming that markets have risen up too much too fast, and the Indian market is fairly expensive now. Today saw a steep fall of the mid-cap and small-cap stocks. No one who was watching stocks today could have failed to notice the depth of the fall; officially it is 3.54%, but it feels more in the range of around 5% (depends on the scripts owned, I guess).
As always, be very careful when investing in penny stocks; they can be extremely risky, and even a tip from a place seemingly very safe could be just based on a rumour. There can be a lot of money to be made from small-cap stocks, but money can get lost pretty quickly also, hence be careful.
Stocks that I am currently tracking:
1. Reliance Ind: Rs. 3054
2. Yuken India: Rs 348
3. Supreme Industries: Rs. 350
4. TRF: Rs. 1956
5. P G Foils: Rs. 118
6. Patel Airtemp: Rs. 132
7. JMC Projects: Rs. 500
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