If you want to make money in the market in short term doing trading, you must listen to your own wisdom rather than blindly following black crows (as per Peter Lynch, these analysts appearing on the TV and singing same tune are called “black crows”). Moreover when all the analysts start speaking same language & all agree on the same direction of the market, you must take contrary view. This is because everyone can’t be right at the same time. If you ask any tom, dick & harry analysts now, everyone will say “We are yet to see the bottom”, everyone will talk about further slide and they will say “worst is not over” so and so. But just think for a moment if they are so much confident of their call then they should sell their house and SHORT the market, but no one will do that. Anyway, coming back to the point, when whole world is talking pessimism you must talk optimistic and yes you will be right just like when Reliance Power IPO came whole Indian public were rushing to make quick money, optimism is at the peak, and that was the time to think bearish, if you would have thought bearish then you must have minimized your losses!!!
Indian Market Update:-
The Indian market closed lower in a volatile week over mounting concerns about the contracting global economy and deteriorating macro situation. Even the surprising fall in inflation to nearly six month low (8.98%) could not lift the spirits of the beleaguered bulls.
Market participants also shrugged off the improved IIP data for September, on worries that the IIP for October and the coming months may throw up negative surprises due to the severe credit crunch in the local economy. Finally, the NSE Nifty slumped 5.5%.
Real estate stocks were pounded on concerns that property prices will crash on account of dwindling demand. Banking stocks fell sharply on concern that the tight credit markets could hurt their profitability and there could be considerable rise in bad loans. Auto stocks were among the major losers, led by a fall in Tata Motors after the company said it will shut down its commercial vehicle plants in Pune and Lucknow for six days during this month due to slump in demand.
Asian markets remained under pressure after the US Treasury scrapped plans to buy risky mortgage assets. Volatility was at its peak in the US as recession fears overshadowed any relief from China's $586bn stimulus plan. Circuit City, the No. 2 US consumer electronics retailer, filed for bankruptcy protection. US also revamped its deal with AIG after the insurer posted a quarterly loss of US$24.5bn. Meanwhile, shares of GM and Ford slumped amid worries over their fast deteriorating future prospects.
-Sandeep Jain, Research Analyst
0 comments:
Post a Comment