Pre-Market report on 18.03.2008

[K.Karthik Raja]

Time for some sanity?
Mar 18, 2008

Dalal Street is poised for a nervous opening,trying to recover from
the crash yesterday. The investor sentiment is at an all time low. It
is really hard to find buyers in the current market. The market
currently lacks liquidity as the retail investors are staying away
from the markets and the FII's have been consistently selling in the
past week. Bear Stearns a.k.a BSMA and Merrill Lynch played their role
in damaging yesterday's session. It appears Merrill Lynch is in "Quit
India" mode.

The US markets did not plunge as expected,the Dow Jones industrials,
in an
erratic session, closed up 21.16 points, after having plunged nearly
200
points early in the day.Nasdaq took the opposite direction ending down
35
points or 1.6 percent at 2177.The Fed Reserve, which is expected to
meet on
Tuesday is expected to cut the interest rates drastically, may be a
100 basis
point cut is in the offing against the much expected 75 basis point
cut.

Coming to the domestic markets, although the valuations look
compelling
figuring out a bottom is a tough deal. Investors are skeptic about
catching
the falling knife. Interestingly there were no advances among NSE-50
stocks
yesterday. Today might be a different story as things are settling
down in
the global markets. we expect the markets to recover a bit in the next
two
sessions as the correction looks overdone.

Markets might end on a flat note or recover a percent from the
current
levels. We feel that the bottom is close and getting closer everyday.
The
only event that could spoil the hopes of a recovery, is a default by
another
major investment bank as mentioned in our weekly review.

Market Close Box:

BSE Sensex 14809.49 -951.03
NSE Nifty 4503.10 -242.70
USD Rs.40.77
Oil Nymex $105.6

K.Karthik Raja