Created: Wednesday, 24 September 2014 12:07
Adverse Global cues with Western Markets in Europe fell flat because of Slow Growth in September, the second month running. The decline in Manufacturing sector data for Germany triggered a slow down in Wall Street,the FTSE 100 dropped 1.4 percent to 6,676 and The EURO STOXX 50 Index, Europe's leading Blue-chip index for the Eurozone, is down to 342 down 1.4 percent.
The The Dow Jones Industrial Average showed a downward trend with a drop of 0.7 per cent to 17,056 and the S&P 500 dropped 0.6 per cent to 1,983.
This is Compounded by a rapidly developing Geo-Political situation in Syria with USA -Arab Coalition Decision to go in for a strike, and Obama Decision to take the fight to ISIS
Volatility in Indian Markets is to be expected with ending of Futures and Option Contacts on Thursday. Derivative Market is also set to have a roll over position by the end of this week. The Metal Stocks will also come under hammer if Supreme Courts fails to pay heed to Indian Government plea on 46 Operating Mines. The Order could be delivered this afternoon. The IT Stocks which enjoyed a High because of strengthening US Dollars, will not find it easy going forward, because of weakening US Markets.
On Home Front the Positive news of Indian Launching succeeding on its maiden attempt to be placed in Mars orbit of Managlyaan, and being part of an Exclusive club of three countries for Doing So, hopefully will install a positive sense of Pride in Indian Markets. Further the wait will be for Monetary Policy of RBI to be announced on 30th which could be a sign for Investors for the Direction Markets will take in the Futures. The Market has endured a brutal correction on Tuesday and should find some support with bargain hunting Traders. As Vivek Gupta Director Research Says Trading is a Business which requires time, patience and consistent discipline. We hope you Invest in Stock which have low risk and High Return.
Created: Monday, 22 September 2014 14:55
If you were wondering what it will take for the rupee to break out from its sideway movement and for the Nifty to recover from early-2014 losses, Modi is your answer. The more it became apparent that the Gujarat Governor would become the next Prime Minister of India, the stronger the rally of Indian assets.
Interestingly, Modi has displayed a willingness to work with the other keyman of India’s cog-in-the-system: Reserve Bank of India Governor Raghuram Rajan. There were initial fears that Modi may clash with Rajan because Modi, who is pro-business, would like a weaker rupee. Rajan, however, has made it extremely clear that his top priority is to combat inflation – and the quickfire way to achieve that goal is a strong Indian currency. Modi, thankfully, has also made battling inflation his top aim – and he has made good his word, by imposing export restrictions on certain food commodities.
Speaking from the point of an economist, we would really like to see solid economic reforms from India’s new government that could potentially usher in a new era of strong emerging market growth. India is as complex as it is problematic; yet, one cannot deny the huge economic potential it possesses. Efforts to reduce government red-tape, increasing productivity, raising education standards and of course, safer laws for women will be strong steps in the right direction.
Rupee Outlook: The euphoria appears to be fading. One month ago we were pretty confident that the rupee would continue strengthening, but we were always of the opinion that the rupee has to weaken in the longer run. The rupee trended between 61 to 64 per dollar for the better part of 6 months – with no clear improvements in the Indian economy nor the US economy, the rupee should remain status quo in this range. The run of the rupee to near-58 was slightly unwarranted and the position is now unwinding.
The Nifty Index: The Nifty is at an extremely lofty height and it looks extremely toppish. Technically speaking, weekly RSI has crossed 70 for quite some time now, indicating “overbought” status while the index is starting to fall off the upper Bollinger band. This could be the start of a downtrend. However, the P/E ratio of India stocks remain relatively cheap – at 15.3, it is roughly about the same as Thailand’s. The cheap valuations of Indian stocks should give it some support. Using retracements, the Nifty is likely to find support at 7,065 and 6,872.