Week Ending 27 November 2015

Dear Patrons, welcome to the weekly analysis of the stock markets. At the start let me apologize for not writing this blog for last two weeks. Let us do some catching up. 

In the last blog, we had mentioned about positive outcome of Bihar elections and market moving up and 7700 on Nifty to be the worst case scenario. We were proved wrong on the Bihar election results front, but bang on on Nifty front. Nifty touched a low of around 7710 in the aftermath of Bihar results and currently stand at 7942, gaining more than 3%.

The markets have remained range bound over the last two quarters and our focus has been very stock specific. We had mentioned to buy the ABC in the markets. Namely Automobile, Banking and Cement companies. Automobiles have performed exceedingly well since we mentioned. Banks have been under the hammer for quite some time now, and we believe this is the right time to buy good quality PSU and Private banks.

In other news, there is a good news in store as far as Governance is concerned, for the first time in last 10 years India is a Fiscal Surplus economy. The little steps that the current Government has taken for fiscal consolidation has started yielding fruits, there is long way to go though.

Where do we go from here?

Currently Nifty is trading around 7950. We believe it has the strength to move upwards to 8000-8050, with resistance around 8030. 8030 is the level to be watched and we expect selling to resume around that level. December may as well turn out to be a negative month for the markets. There is a twist to it though, FIIs will be on holidays for Christmas. FIIs have been heavy sellers during the last two quarters and their absence may be a welcome thing for the markets.

However, we will take a call on the markets as it comes. The mantra remains the same saty invested in good quality stocks.

Happy Investing!!!

Week Ending 6 November 2015

Dear patrons, welcome to weekly analysis of the week gone by. On the onset "Wishes for a Happy, Healthy and prosperous Deepawali" to you. May this Deepawali bring lots of Joy, Wisdom and Prosperity to you.

Coming to the markets, Nifty saw a lack luster week. It lost around 1% from the previous week, but the movement was very dull and stock centric. What we saw during the week was lightening of positions. The markets opened higher on a couple of occasions but failed to sustain the gains and lost ground on back of profit booking on account of Bihar election results.

Bihar Election results played the spoilsport during last week, as investors awaited the outcome before taking any risk in the market. In the likely outcome of the NDA forming government in Bihar, we may see smart up move in the markets, if however the results are against the NDA, we may see a knee jerk reaction and stability thereafter. The markets were jittery due to Bihar is evident from the following chart. Indian Equities were worst performing among asian peers and most of the blame goes to Elections in Bihar.

What should we do in this market?

As always, the mantra remains same. Select good quality stocks and Stay Invested. 

As suggested in the last blog Nifty managed to float above 7950 for the week, although it broke 7950, it closed above the level. We believe, with a positive outcome in Bihar and negative data in the US, Nifty should start moving up from Monday. The worst case scenario on Nifty is 7700 levels. However, we would also like to be cautious on the markets for some more time as far as trading is concerned.

Happy Investing!