----------------------------------------------------------------------------------
This is the 2nd day in row; we did a wrong predicted of the Indian Stock Market. Indian markets are getting carried away due to global financial concerns. There is no active participation from FII, volumes are low, market is confudes and fear of Lehman fall is looming large.
Fall is crude prices are getting nullified by depreciation of rupees. A combination of falling crude prices and the depreciating rupee have deprived the oil marketing companies of the advantage of falling prices.
The oil prices have gone down by 33 per cent and the rupee has depreciated by 15 per cent in the last three months so 50 per cent of the benefits of falling crude prices has been eaten up by the depreciating rupee.
Indian Market Update:-
There is no good news from the markets. It looked like it was going to be another listless sort of session, much like what we did in trade yesterday. But the second half actually saw much more weakness for the screen and by the end of it we have taken off quite a bit, both for the frontliners and for the midcaps.
The start was not great. The market just ambled about in a very tight range. But in the last one hour, we could see the selling pressure building up, which is why the Nifty has actually closed below the 4,400 mark. They are still stuck in that range and it hasn’t made any meaningful move. It is just that day after day we are seeing a slow grind coming into the market.
The Sensex closed 238.15 points down at 14,662.61. The Nifty closed 68.45 points down at 4400.25.
Global Market Update.
There seems to be no end to the negative news in global market with Lehman Brothers Holding Inc., one of the largest institutions in the US declaring a preliminary net loss of $3.9 billion due to the mark to market adjustments stemming from write-downs on commercial and residential mortgages and real estate assets.
Stocks rose Wednesday, a day after a steep sell-off, as investors digested Lehman Brothers Holdings Inc.'s plans to try to sell a majority stake in its investment management business and spin off its troubled mortgage assets.
They're trying to buy time but it's very dangerous on Wall Street to buy time. You need to be able to do business. For the time being we might come out of bankruptcy fear but if there is any problem with underlying business, sooner or later we have to face the realty.
HBJ Capital’s Views for tomorrow (Thursday).
- Low market participation and lack of foreign inflows saw equities end lower on Wednesday. Market men avoided fresh positions ahead of quarterly results by US investment bank Lehman Brothers later in the day.
- As per our previous posting, Lehman was suppose to announce the result on Thursday but it seems they are going ahead a day before, means on Wed itself they have announced the result so fear of market fall on friday can be ignored.
- Domestic inflation and IIP data expected on Thursday. According to reports, India’s inflation rate for week ended August 30 is seen easing for the third consecutive week to 11.96 per cent against 12.34 per cent a week ago, while Index of Industrial Production for July is expected to be higher at 6.5 per cent higher from 5.4 per cent in June.
- Fall in rupee below 45-mark against the dollar also kept players under check. The rupee’s fall to 45.12 versus the dollar raised fears of it having an adverse impact on inflation, as imports become expensive.
>>>>>The markets are likely to remain under pressure. Sentiment might improve if inflation and IIP data, due Thursday, are positive. Falling crude oil is also a good sign. However, overall global recessionary impact will likely overshadow the positive signs.
>>>>>HBJ Capital team is expecting that Indian Stock Market should bounce back and rise > 1% or more.
>>>>> For the time being Lehman fallout fear is gone, Crude is falling, IIP & Inflation data if comes +ve then once can see upside in Nifty.
Trading Strategies for Thursday:-
During last two days, fresh build-up of short positions in Nifty was seen, which might get cover-up on Thursday if Nifty moves more up than 50-60 points, such short covering will trigger further upside.
The Nifty is consolidating in the range of 4,380-4,520 and has to close above 4,520 for a further rally. If the index closes below 4,380, the next support is at 4,280.
#1. If you have LONG position, just hold it, any +ve sentiment on thursday will lead to rally which will continue on Friday too. Fresh long position can be taken if IIP numbers comes better than last month.
#2. Pls avoid SHORT position or PUT options, inspite of two days fall in Nifty, we still feel that market is not going to fall unless any bad news from global front comes up.
-HBJ Capital Team
0 comments:
Post a Comment