Posts Tagged ‘global cues’

Market to Go Volatile This Week, Due to Host of Factors

Market to Go Volatile This Week, Due to Host of Factors

The Market is likely to remain volatile this week as a host of triggers are set to guide investor sentiments. These factors are :

1. Expiry of the October series of derivatives contracts,

2. September quarter results of some key companies such as Reliance Industries and

3. the RBI money policy review.

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Global cues may also induce some choppiness in the market.

Noted Market analyst, Jagannadham Thunuguntla, head of equities at SMC Capital quoted that;

“The market is facing heavy pressure.  There a wide gap between fundamentals and stock valuations.  The second quarter results have come up less than what most investors had anticipated”.

He also added “though the average profits of companies, which have so far reported second quarter results, have grown 30-40 per cent on cost-cutting measures, growth in net sales has been sluggish“.

Also Thunuguntla said that “we have huge liquidity in the market thanks to the 100 per cent rally and this has helped the market sustain at this level till now. No doubt, fundamentals are catching up with valuations slowly”.

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Thunuguntla said the market was in a consolidation phase.

“It may remain volatile this week ahead of the expiry of near-month futures and options contracts and the RBI policy review.”

On the global front, the US will disclose its third quarter GDP figures on Thursday.

Meanwhile, the rate of inflation jumped to 1.21 per cent for the week ended October 10 against 0.92 per cent a week ago.

The BSE Sensex slipped 512.01 points, or 2.96 per cent, last week to close at 16,810.81.01.

The Nifty index on the NSE dipped 145.10 points, or 2.82 per cent, to end the week at 4,997.05.

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According to other observers, Nifty has a support at 4,900.
Market sentiment may get hurt if this level is breached.

Thunuguntla also said investors would keenly follow the quarterly results of Reliance Industries as well as global cues.

“Amid the fight between the Ambani brothers, investors will watch the RIL results keenly.  Global cues will also be followed after a few bad economic numbers from the US last week,” he said.

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Foreign institutional investors (FIIs) on Friday remained net sellers, offloading equities worth Rs 295.70 crore, according to figures available at the website of market regulator Sebi.

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Market to track rains, IIP data and global cues

Share market India

The market is likely to track the Monsoon, the Index of Industrial Production (IIP) and global cues for direction this week.

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Market might fall to 14,000-14,500 levels if both the monsoon and global cues turn out to be negative this week.
Expectations are capital goods stocks to perform better in the short run.

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Investors are likely to pay heed to global cues and news related to the monsoon and IIP numbers.

If both domestic and global cues are negative, then we may see the Sensex taking support at 14,100.

A bad monsoon may pull down growth by a quarter. So, rain-related news has high significance.

Stocks in the capital goods counter and Reliance Industries may perform better in the short term. 🙂

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Last week’s selling spree by foreign institutional investors (FIIs) was due to fears of a weak monsoon and profit booking.

“The weak monsoon is a big worry right now. It can spook investor’s sentiment.  Apart from this, investors are likely to track global cues while the numbers on IIP will also be keenly watched. 🙂
The selling spree by the FIIs in the past few sessions could be attributed to profit taking on account of good values as the market has risen more than 100 per cent since March 9, from 8,000 to 16,000 levels,” said Jagannadham Thunuguntla, head of equities at SMC Capitals.

Thunuguntla said all sectors are showing signs of recovery and, hence, there are less chances of any major shock from the IIP numbers.   “However, poor rainfall and the subsequent fall in rural demand may put pressure on some sectors,” he said.

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