Tuesday 31 May

After a pause yesterday (with hardly any change from Friday levels of 5476 to 5473 (sensex 18266 to 18232)
today the market gained over 300 points sensex and Nifty 95 points nearly 1.7%.. Looks like the onset of monsoon on Kerala shores have enthused the market. Any a good monsoon is not going to bring down the prices overnight. Inflation for the next few months is likely to be around the 8 to 9% range .

Nifty closed @ 5561 -up 88 and Sensex @ 18508 - up 276. Almost near the high for the day.

Almost all shares participated in the rally - specially the Banks . Surprising considering that RBI is likely to raise the rates once again in June - may be this was already factored in the price crash last week.

Wait for the index to cross 5650 before taking any buying decision.
The market crashes down faster than the speed at which it goes up - wait for the 5650 levels and the global cues before getting very excited about the gains in the market index.

This month F&O - has 5 weeks for expiry - so I guess it could be a good idea to go in for some put options after the index crosses 5600 levels to protect  your portfolio.

Friday 27 May

The market closed on a positive note with sensex @ 18275 (up 231) and Nifty @ 5476 (up 63).

Almost all shares participated in the up move. Notable exception was Tata Motors - which after announcing a not a bad result - went down by over 6% on analysts downgrades as well as the muted guidance given by the management for the next quarter.

Inflation is still up , the price increase in Diesel & LPG expected in the next 10 days and RBI likely to increase rate once again in June by .25%. So the move would be temporary - and one can invest now only for a very short term -say a week or so.

Thursday 26 May FO expiry

Market retraced the loss of yesterday and closed above 18000 and 5400 Nifty.

Nifty @ 5412 (up 63) and Sensex @ 18044 (up 197).

But the trading was pretty lackluster - nothing happening except that it was May F&O expiry - so there were some stock specific actions for carry forward.

Reliance on the news of the freeing of gas prices for non core customers and TISCo after announcing the result - which included some one off write backs of provision made earlier and a better than expected result for European operations  were both up by 2%.

Reliance likely to benefit from the above freeing of gas prices - only if it can ramp up its production .

Tisco - the price of gas to steel suppliers (as they are  non core by Govt definition)  are likely to go up and also the raw material prices are still rising - and Europe has  its own set of problems of economic slowdowns.

Unless the major Banking stocks and the IT stocks start moving up - the market definitely headed lower towards 17600 levels 5300 Nifty levels.

Wednesday 25 May

Not a very exciting day - the market went down steadily downhill by over 200 points (sensex) and Nifty by 60 points.

Market closed near the lows - Nifty @ 5349 (down 45) and Sensex @ 17838 (down 173).

The downside now seems to be not more than 2 or 3 % and the upside could be 8-10%.
SBI and ONGC now look good to buy @ 2280 and 260 resp. There can be further 3 to 5% downfall from here but this scrip looks for an appreciation of 20% in next 6 months.

Tomorrow - F&O expiry - can expect some unexpected movement - for now it seems that Nifty is headed for 5300.

Tuesday 24 May

Fairly a flat trading day.

Sensex 17970 - 18050 & Nifty 5380 -5420.

Closed near the lower end.

with two days left for May F&O expiry - Wednesday & Thursday sessions should be interesting.

The brokers seem to be betting on sub 5300 levels - have been recommending investors to buy the 5300 put @ Rs 7 - towards the close of session .

Monday 23 May

The market following the global cues was down near 2% today.
Nifty 5380 (down 105) and Sensex 17990 (down 360).

In general all counters were down - specially the bank stocks - down by over 2% in general.
Looks like the market is factoring in the expected rate increase by RBI in June .

The selling by FII continues - nobody seems to be confident .

If the support @ 5350 for Nifty breaks tomorrow - then we can expect the market to go much lower in the next few weeks .

Since there is only 3 days for F&O expiry - one can expect fair amount of volatility - the range now is 5250 to 5550.

Wednesday 18 May

Market closed @ 5420 (down 18) and Sensex @ 18084 (down 52).

SBI down 2.5% and Reliance was below 900 (down 2%).

seems heading for the 5350 / 17800 levels.

Buy SBI after further fall of 5 to 6% around 2250.

Reliance seems to be in some kind of denial - not able to explain the fall in gas output.
Wait for this explanation before buying this stock.

Tuesday 17 May

The market made a new Low - 5430  & closed @ 5440 (down 58) and Sensex closed 18142 (down 202).

Another 2r days of fall should take the market to around 5350 & sensex 17800.
This level would be good time to start buying stocks - in phases as the downside after this may be only around 2- 3% - whereas the upside could be over 10%.

Todays star performer was State Bank of India - which announced its Q4 results - Net Profit @ 21 crores against the previous yr Q4 of 1867 cr - down 99%. This was mostly due to higher provisioning against bad loans  by 1097 crore (3284 cr against 2187 cr).
Well Mr Bhatt seems to have done well @ SBI - to leave the bank with probably the worst Q4 result in a decade. The share price went below 2,400 - down 8%.
Based on this SBI result - all the banks (specially the PSU) took a tumble - this week one can expect most of the PSU banks to tank a bit (may be a lot) more.
Looks like most of the banks are due for correction in price by around 10% from the current levels.

Monday 16 May

The market erased all the gains of Friday and closed - sensex 18336 (down 195) and Nifty 5495 (down 49).

If the support @ 5450 Nifty or 18200 sensex does not hold tomorrow - then the market is headed for another correction downwards of 3 to 4% .

Thursday 11 May

The market closed @ 5484 (down 80) and sensex @ 18345 (down 240).

Apparently the market for some strange reason was not impressed with the IPP (indl prodn ) of 7.3% for march 2011.
This was way higher than the analyst estimates of 3.7%. .

As soon as the figures were announced - the market after a slight knee jerk to 18600 - fell steadily to 18345.

The food inflation for April was also lower - @ 7.7 Vs 8.53% WoW - and the fall in crude prices to below $ 100 also did not have any effect.

As usual the weak global cues were cited as the reason for the fall .  Oh yeah!

Any way - tomorrow the election results for TN/Kerala/WB and Assam will be announced and tomorrow being end of week AND Friday 13th -  lets hope the market does not test the 5350 levels.

A good day to go on a long week end and forget the market.

Wednesday 11 May

The market was in the range 5524 - 5575 closed 5566 up 20.

Sensex 18450 - 18600 closed 18568 up 55.

the market is struggling to cross the 5600 levels - and the upside seems capped @ 5640 and the downside @ 5350.

Tuesday 10 may

The market was volatile : 5551-5590 - to 5515 to 5539 (down 11) intra day high low 75.
Sensex intra day high low 200 points 18528-18670 - 18470 and closed @ 18504 (down 24).

Seems the market is struggling to cross the 5620 or 18700 mark - once this is crossed - can expect further 1% rise to 5680 or 18900.

But it seems the downside @ 5450 (down 2% from 5540) seems more likely.

Upside seems capped @ 2% while downside of another 5% seems more likely.

Market to stay away from.

SKSMicro - after falling over 50% from 550 to 250  in the last one week - recovered 10%  to 298.
One wonders whether all the FIIs , George Soros and Narayan Murthy who bought the shares @ IPO around 800 are still invested in this scrip?
Six months back @ the time of IPO,  this scrip was touted as the next superman of Indian stock market ???
From the IPO price of 985 the stock has now fallen over 70% - & this issue was oversubscribed 14 times.
After the IPO the share price touched a peak of over Rs 1400 - so if you are holding this scrip after buying @ peak - you may probably  have to wait another 10 years to get back your investment on this scrip.

There is a lesson to all investors in SKS scrip - once there is any internal feud between the management (as in this case between promoter and CEO) - one should get out of the scrip. At that time one could probably have recovered most of the investment. 

Monday 9 May

Market closed flat for the day- after opening strong @ 5570 and then drifted lower to 5510 and closed practically unchanged @ 5548.

5570 - 5510 - 5548
& sensex 18600 - 18400 - 18529.

Tomorrows trading probably could throw some light on the next short term move.

Friday 6 May

The market closed around 1.5 % up for the day @ 18508 (up 298) and Nifty @ 5546 (up 86 ). the market closed almost near the top for the day.
For the week - the market closed 3.5% lower.
This week - silver was down 28% - Gold -5% and Crude around 10% so far.

Going forward - if the market consolidates around this level of 5500 - 5600 then we might see the market inching towards the 5680 level.

But with all the macro issues -inflation & interest rate and GDP number being revised by every economist who is given some face time on TV - market going up in the short term does look unlikely.

If the commodity prices continue to go down next week also -then there is no reason why the market can not rebound to 5650 next week.

Thursday 5 may

Another day - 9th day in a row where the market tanked big time.  9 consecutive days of fall - is definitely a new record - at least in the last 6 years.

Sensex closed @ 18190 (down 277) and Nifty @ 5453 (down 84).

So rally which started in February  @ 5300 and sensex 17600 or there abouts seems to be over.

If there is no big bounce back in the next few days - and the index goes below 5200 - the long term trend will turn bearish.

Nifty is now way below the 100 dma , 200 dma and 20 Dma.

I am sure most fund managers would be wishing that they were on vacation now.

The ghost of 2008 - is it around the corner.

My personal take - the market would go for a 150 point correction upwards next week  to around 5550 .
But then - the market does not respect wishful thinking. All macros - inflation, interest rate , political scenario ,  earnings projection for FY12 and GDP rate seem to be either negative or on the lower side.
Only good thing so far - liquidity still seems to be good and the panic has still not set in - as this correction of 1300 points sensex or  450 points Nifty is still termed by the TV experts as intermediate correction !

Wednesday 4th May

The market had a weak opening going down to 18400 (down 140 points) and in Nifty 5510 (down 55 points)
and then around midday recovered to 18560 and Nifty 5580.

Towards the close the market fell back towards the lows and finished @ 5531 (down 34) and sensex down 74 @ 18460.

Banks were the worst affected - most of the Banking stocks were down around 10 - 12% in the last 3 trading sessions - SBI/YES/ICICI/BOB - and almost all other PSU banks.

May seems to be an established Bearish month - last year the Nifty fell from 5278 to 4786 during the month - a fall of nearly 500 points (sensex around 1400 points).
In the last one week Nifty is down 270 points (from 5800 to 5530) and the sensex down nearly 700 points so far.
Also in the last 2 days Silver prices fell by nearly Rs 6,000/kg.

So if the past year is any guide then the market is heading towards 17500 sensex or Nifty 5250.
Or is this year going to be any different??
My personal opinion is that crude oil prices now around $ 110 would drift down by 10% to below $ 100 in the next few weeks and this would have some favorable effect on the inflation figure for May - and the market unlikely to go much lower - as the liquidity position is still good - though the sentiments are very negative.

Would I bet on my own opinion? - very unlikely,

Tuesday 3rd May

RBI announced its monetary policy - and raised the interest rates by 50 basis points. Though this was expected by the market - the guidance given by RBI that the growth rate for FY12 was likely to be 8% (against prev projections of 8.4%) and also that inflation was likely to remain high till September - really spooked the market and the index crashed - Nifty by 140 to 5569 and Sensex by 478 points to 18520.

The market seems to be now in a new low territory - there are no optimists now left in the market. The consensus (over 90%) of the analysts are predicting further fall of 3 - 4% from these levels.

Banking stocks were the worst hit - by 5- 15% in the past 4 trading sessions. Today other rate sensitive scrips Viz Auto and real estate companies also had a fall of over 3%. And the index heavy weight Reliance seems to be going nowhere - with each day talk about how less gas they are likely to produce in FY12.

All in all - it seems to be a good month to close shop and go on a vacation. The only major trigger for the market could be the election results - due after 10 days and the expected fall in crude prices to $ 100 by the end of next month (wishful thinking).