Pre-Market Report: 23.06.2009
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B. Karthick
Jun 22, 2009, 11:59:10 PM6/22/09
to Kences1
Green Shoots turning brown, Another day of pain on the cards
Concerns about a lengthy recession is back in focus as investors
wonder about the recovery in the economy. Expect a massive sell off in
the first hour of trade, as negative global cues might take a toll on
stock prices. The Sensex is likely to give up more than 2 percent or
300 points after a sell off on Monday.
A surprisingly bleak forecast for the world economy pushed stocks to
their biggest loss in two months on Wall Street. he Dow fell 200.72,
or 2.4 percent, to 8,339.01, the Standard & Poor's 500 index fell
28.19, or 3.1 percent, to 893.04 and the Nasdaq composite index fell
61.28, or 3.4 percent, to 1,766.19.
A weaker than expected growth forecasts from the world bank is a big
dampener for the markets today. The World Bank said it expects the
global economy will shrink 2.9% this year, a deeper fall than the 1.7%
contraction it forecast in March.
There was a major sell off in commodities market today. In the metals
market, prices for July silver and platinum each lost 3.4% and copper
contract for that month slid 5.3%. Stocks in this sector are likely to
take a beating today. Watch out big price movement in Tata Steel,
Sterlite Ind and Hindalco to the downside.
There are rumors in the market that IFCI, is looking to rake in a
partner and is considering various possibilities. We think that this
far from happening and any up move in the stock could be used to exit
the stock in the short term. Investors are also advised to stay away
from speculative midcaps in the current market scenario.
On the flip side, we believe that the current correction will provide
long term investors to 'accumulate' select stocks. We like some stocks
in Healthcare and some select 'value' stocks which could provide a
decent gains in the run up to the budget. We advise day traders to
take small positions after a drop of nearly 2.5 percent on the Sensex
as there is a possibility of a minor pull back.
B.Karthick
Research Analyst.
Concerns about a lengthy recession is back in focus as investors
wonder about the recovery in the economy. Expect a massive sell off in
the first hour of trade, as negative global cues might take a toll on
stock prices. The Sensex is likely to give up more than 2 percent or
300 points after a sell off on Monday.
A surprisingly bleak forecast for the world economy pushed stocks to
their biggest loss in two months on Wall Street. he Dow fell 200.72,
or 2.4 percent, to 8,339.01, the Standard & Poor's 500 index fell
28.19, or 3.1 percent, to 893.04 and the Nasdaq composite index fell
61.28, or 3.4 percent, to 1,766.19.
A weaker than expected growth forecasts from the world bank is a big
dampener for the markets today. The World Bank said it expects the
global economy will shrink 2.9% this year, a deeper fall than the 1.7%
contraction it forecast in March.
There was a major sell off in commodities market today. In the metals
market, prices for July silver and platinum each lost 3.4% and copper
contract for that month slid 5.3%. Stocks in this sector are likely to
take a beating today. Watch out big price movement in Tata Steel,
Sterlite Ind and Hindalco to the downside.
There are rumors in the market that IFCI, is looking to rake in a
partner and is considering various possibilities. We think that this
far from happening and any up move in the stock could be used to exit
the stock in the short term. Investors are also advised to stay away
from speculative midcaps in the current market scenario.
On the flip side, we believe that the current correction will provide
long term investors to 'accumulate' select stocks. We like some stocks
in Healthcare and some select 'value' stocks which could provide a
decent gains in the run up to the budget. We advise day traders to
take small positions after a drop of nearly 2.5 percent on the Sensex
as there is a possibility of a minor pull back.
B.Karthick
Research Analyst.
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