Epaper
It is a silent day in the global markets with the Wall Street closing near the previous levels only after Dow Jones swinging 100 points. On the other side NASDAQ is approaching its 16 month closing lows slowly but surely. Earlier the manufacturing Index pointed towards contraction in the sector after recording its lowest reading in five years. After hours Intel reduced the gross margin forecast citing raw material prices.
Japan opened subdued to the global cues and the currency continued its strength against the dollar. At the time of writing Nikkei is trading down 90 points. Indian Finance Minister remarked that “Indian Economy is not as decoupled as we think”. Mr. FM is correct and India cannot decouple with the vote bank budgets. Indian Economy is at a critical juncture and we expected the government to boost more infrastructure spending, come up with power sector reforms, tackle the strong rupee and many more. But none of the concerns are addressed as the minister tried to play safe for the forthcoming elections.
Pharma sector is in the pink of health yesterday as investors/funds rushed to take comfort in the defensive sector. Auto stocks continued to make merry after the budget sops. Gold is running and so is Crude and Silver. Copper hits a 22 month high. There is a huge rush for precious metals across the globe. Commodity analysts predict the continuation of the secular bull run in the precious metals space.
Retail Investors are reluctant to participate in the markets and rumours are flying at a rapid pace that BSE Sensex will kiss 12,000 levels. Looking at the trading volumes one cannot deny those rumours but when the reversal happens it doesn’t given an indication too. This is a dangerous market to short too. Take a break. Pick your favourite destination and enjoy your holiday as the current markets will drive you nuts.
The street is likely to be subdued today with a 200 point range and the brokerage stocks hammering likely to continue further. As Merrill Lynch said yesterday that the resilience the US market despite of the continuous negative news flow is really surprising and at the same time the Emerging Markets are succumbing to the same news flow. As mentioned number of times no one can predict the bottoms. Long term investors should continue the bargain hunting.
— Review written by Research Team @ www.indiabears.com
