Pre-Market report on 24.03.2008
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Sukumar
Mar 23, 2008, 11:37:11 PM3/23/08
to Kences1
Bears strike commodities, taking a break in Equities
====================================================
Bears shifted flanks from Equities to Commodities, which bore the
brunt of selling in the last two trading sessions. Gold and Crude oil
lost nearly 10 percent from their highs in the two days marking the
biggest loss in a single day in the last 2-3 years. We believe crude
oil is purely running on speculation and is certain to trade in two
digits for the next couple of months.
It was an eventful week in Wall Street. Bernake led Fed has provided
the much needed support for restoring confidence in the investors,
though many say it is too early to party. Fed has raised the bar and
improved the liquidity in the system and then came the better than
expected results from Lehman Brothers and Goldman Sachs providing much
comfort to the battered investors.
This week will be more eventful in terms of data and is expected to
provide a clear direction where the Wall Street is heading towards.
Japanese markets were trading ranged after a gain of more than 200
points on Friday. Currently Nikkei is up by 47 points at 12,529.45.
Japanese Yen is trading down at 99.80 against the US Dollar.
Dalal Street failed to latch on to the excellent opportunities the
Big
Brother has provided. Dow Jones from the beginning of the year(2008)
has lost 682 points or just above 5 percent while its Indian
Counterpart BSE Sensex lost 5,470 points or 26.7 percent. The impact
of FII's was clearly visible when Bear Stearns was dumping the stocks
in the market. Many midcap stocks found no takers despite of sound
fundamentals. India story suddenly started appearing pale and ICICI
Bank is dragged into the gutters on the news of sub prime exposure.
Rising inflation is keeping a check on the RBI governor to raise
interest rates
There is absolutely no reason for the markets to run away from this
level due to two primary reasons.
1. Lack of retail participation.
2. No major moves expected from the government due to forthcoming
elections.
There is no reason to believe Indian growth story is no more. But we
may observe a serious slow down in many sectors and the major reasons
attributed to global credit scenario. Liquidity crunch in the US sold
off the emerging markets and it will take some time for things to
settle down. Long term investors can continue to pump funds into the
market.
Indian Markets resumes trade today after a holiday hit last week.
Trade will be subdued and we believe downsides are limited from these
levels. It may be a surprise if we see Sensex gaining more than 200
points.
Market Close Box
BSE Sensex 14994.83 161.37
NSE Nifty 4573.95 40.95
USD Rs.40.37
Oil Nymex $101.8
N.Sukumar
Research Analyst
www.kences1.blogspot.com
====================================================
Bears shifted flanks from Equities to Commodities, which bore the
brunt of selling in the last two trading sessions. Gold and Crude oil
lost nearly 10 percent from their highs in the two days marking the
biggest loss in a single day in the last 2-3 years. We believe crude
oil is purely running on speculation and is certain to trade in two
digits for the next couple of months.
It was an eventful week in Wall Street. Bernake led Fed has provided
the much needed support for restoring confidence in the investors,
though many say it is too early to party. Fed has raised the bar and
improved the liquidity in the system and then came the better than
expected results from Lehman Brothers and Goldman Sachs providing much
comfort to the battered investors.
This week will be more eventful in terms of data and is expected to
provide a clear direction where the Wall Street is heading towards.
Japanese markets were trading ranged after a gain of more than 200
points on Friday. Currently Nikkei is up by 47 points at 12,529.45.
Japanese Yen is trading down at 99.80 against the US Dollar.
Dalal Street failed to latch on to the excellent opportunities the
Big
Brother has provided. Dow Jones from the beginning of the year(2008)
has lost 682 points or just above 5 percent while its Indian
Counterpart BSE Sensex lost 5,470 points or 26.7 percent. The impact
of FII's was clearly visible when Bear Stearns was dumping the stocks
in the market. Many midcap stocks found no takers despite of sound
fundamentals. India story suddenly started appearing pale and ICICI
Bank is dragged into the gutters on the news of sub prime exposure.
Rising inflation is keeping a check on the RBI governor to raise
interest rates
There is absolutely no reason for the markets to run away from this
level due to two primary reasons.
1. Lack of retail participation.
2. No major moves expected from the government due to forthcoming
elections.
There is no reason to believe Indian growth story is no more. But we
may observe a serious slow down in many sectors and the major reasons
attributed to global credit scenario. Liquidity crunch in the US sold
off the emerging markets and it will take some time for things to
settle down. Long term investors can continue to pump funds into the
market.
Indian Markets resumes trade today after a holiday hit last week.
Trade will be subdued and we believe downsides are limited from these
levels. It may be a surprise if we see Sensex gaining more than 200
points.
Market Close Box
BSE Sensex 14994.83 161.37
NSE Nifty 4573.95 40.95
USD Rs.40.37
Oil Nymex $101.8
N.Sukumar
Research Analyst
www.kences1.blogspot.com
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