Wall Street continues to slide, D-Street vulnerable

US Markets continued to slide, with S&P closing at a 7 month low. Another 1 pct loss in S&P might trigger a massive sell off technically. Asian markets plunged yesterday following US Markets on friday.

Dalal Street closed better than most of the global markets yesterday and rightly so. One major concern about Indian markets is they are extremely vulnerable to FII selling and one massive unwinding by one fund might create panic in the Indices. For now we do not see any such indications.

Realty and Metals continued to sell of and it is a good idea to stay away from these two sectors. Cabinet board failed to take decision on crude price hike. Inflation will be a major concern if the government says OK to the hike as crude oil forms a major part of our Inflation index.

Reliance Communications continued to swing upwards on the stake sale news. While US based telecom giant AT&T denied reports of the company picking stake in Reliance Communications, it is not going to be that easy to get a buyer for a better price. Telecom will underperform the Indices for the next 2 years. 3G is another pain for telcos which will hit the bottomlines.

Euro continues to slide and this is definitely a cause of concern for US companies that depend on export. Indian Rupee is on a downtrend too, tracking domestic equities and rightly so. We expect USD to hit a longer term top between Rs 48-49

It is a stormy day !!!! And yes it is a black Monday

Hungary debt, US jobs data and the bad news flow continues like a Tsunami. While we are not sure how many visitors to this website recollect our analysis. "The current Euro crisis will be followed by weak US economic data".

Things will only get worse. Do not believe or trust any positive blabberings about global ecnomy. Indian economy will slide too along with the global markets but impact is pretty minimal. It is more of a sentiment than real impact. We are pegging Nifty targets at 4600 in the next 2 months which is a 10 pct slide from the current levels.

Global markets are trading extremely weak today and can be termed as a black Monday with every index losing more than 3 pct while D-Street might not have anything to offer except to tamely go down.

We track US S&P for global market direction as currently global factors outweight local issues and every major market in the world tries to mimic the Big brother (US). S&P is on the verge of a major break down soon. 1045 is the final support and yes that is the final support. Take a note of the number. Below that we see a 10 pct dip in the indices in the US. Are we kidding ?? Nope we are absolutely confident of another 10 pct slide in the US markets if we crack the support levels.

The current wash out will clean up the system and here is another stunning number. We expect Sensex to touch 35,000 levels by 2014 december. One might be wondering that we are not done with the correction and we are talking about the bull run. But the current correction can be termed as a final oppurtunity to enter the Indian equity markets. But you still have time till July/August to do the same. One should accumulate on dips instead of trying to time the bottom.

Bears down but not out !!!!!

Bears are definitely down after making a fortune last month. But we do not rule out a possibility of a massive come back. Reports of Hungary's (Euro Zone) debt situation might keep them active. US Markets are trying to consolidate the gains made on wednesday. Asian markets too moved up big time on thursday. One should keep in mind that the markets are not in a better shape to run from here.

D-Street broke the 5100 jynx yesterday but it is too early to say that we are up for another bull run. Reliance Communication is on a roll on reports of a stake sale. The stock has gained nearly 15 pct in the last 2 days.

Retail investors will be good if they stay away from the current fight between the bulls and bears and watch one of them emerge victorous. Getting into markets at current levels will be suicidal. Paying a stock 5-10 pct more than current price is worth instead of buying during the current situation.

Cement May dispatches were good. There is some interest being shown in stocks like IVRCL, Nagarjuna Constructions and Lanco Infratech. Stay away from realty pack.

Also sources indicate Mr. Subbaroa might surprise with another round of rate hike before the stipulated time

Indian equities to recover

Wall Street jumped on better than expected pending home sales data on wednesday. Asian markets greeted wall street's upmove with a positive start thursday morning. D-Street is no exception with a gap up start expected.

We still question the current uncertainity and stick to our earlier view of sticking to sidelines. Nifty will look good only above 5100 levels. One should be extremely catious below that level.

While there were many stunning numbers from corporates this quarter, Suzlon and Punj Lloyd disappointed. One should be careful in picking stocks that have longivity and fundamental strength.

Shree Renuka Sugars has managed to salvage its billion-dollar acquisition of closely held Equipav SA Acucar e Alcool, the sugar and alcohol assets of Brazil’s Equipav Group. As per business standard's report the company will now be getting the 51 per cent controlling interest by paying only $240 million or Rs 1,080 crore, 25 per cent less than its original bid, sources close to the development said. What’s more, say sources, it will not have to give its own corporate guarantee to Equipav’s lenders for the Brazilian company’s debt.

Indian inflation is another cause of concern and RBI governor Mr.Subba Rao is in a tight spot to raise rates again. For today it is time to ride the rally

Looking down the hill !!!!

Nifty tanked yesterday courtesy a freak trade in Reliance and thanks to the ongoing credit crisis happening in the Europe. US Markets after trading in a extremely volatile fashion ended the day in the red with a sharp sell off in the last half hour.

Asian markets have started looking like as if they have decoupled from the advanced markets, but one should remember liquidity concerns are not country specific. And thanks to the summer period, which traditionally is known for tight liquidity we might see Nifty tank to 4650. We were extremely bearish from the last 2 months and here we go with what we mean.

We advised our subscribers to buy Nifty last wednesday and thursday and again mentioned this week we will see a smashing run from the bear cartel. Coming to economy, GDP, Monsoons one will be wondering why the markets fall despite of excellent conditions prevailing. We cannot defy Mr.Market and markets try to get an insight into few issues far before any retail investor gets a clue about it. This happenned during sub-prime and likely to repeat now. But as many expect we do not see this crisis to impact India in a major way. Panic is yet to be seen in Indian equities..

We are waiting for panic to set in midcaps to add few multibaggers.

Bears back on the battlefield

US Markets opened flat on friday only to end the day with extremely volatile moves. News of Spain's rating downgrade gave a thumbs down to the market. US Markets are closed today on account of Memorial day. Asian markets started the day in red though losses are limited to 0.5 pct

Indian markets are on a roll in the last 3 trading sessions with Nifty gaining as much as 260 points of 5 pct to trade at 5066. We believe Nifty will bump higher above 5100 levels. Metals pack lead the last two days rally with many domestic analysts feeling that the metal stocks are available for a bargain. One should remember that metal stocks reflect the global mood and the major part of the downfall is yet to come.

Euro woes will continue to haunt the markets in the next 2 months. Traders should time their trades to perfection, given extreme volatility and uncertain global economy. Realty participated in the last two days. But the picture for the sector is far from being rosy.

One should be extremely catious before jumping in the market. Wait for 5100-5150 level for Nifty to be breached before jumping in. Till then it is better to watch the show from a distance

Bears paused, D-Street to get the kicker from Wall Street

Wall Street spiked yesterday on china's comments about Euro. It is indeed a dead cat bounce from highly over sold terrirtories. Asian peers are doing well today morning. Indian markets yesterday closed up with Nifty closing near the "Max Pain" 5000. We were mentioning about Nifty 5000 closing from the last 3 days but thought it would be impossible to reach there.

One should be catious before buying on D-Street today as Indian markets has outperformed the rest of the globe in the last 2 days courtesy F&O expiry. Europe troubles ease at least for the time being but we are in for a correction which might unfold early next week.

Small investors are literally pani stuck given the market conditions. We are still not out the woods and as expected US data is looking weak. US revised GDP downwards which was a negative and ignored by markets yesterday. We expect the forth coming data to turn weaker further.

Avoid expensive and fancy sectors for now. We believe this time Nifty might not be able to hold 4800 if it attempts the level.