The Markets had a roller coaster ride last week. Nifty ended with a net gain of 20 points for all the twists and turns.Let us see what the markets have in store for us.
1. The RBI hiked interest rates in a surprise move on Monday to prevent the rupee from collapsing further. This led to the 10 year yield spiking up from 7.5 % to 8.1 %. By the end of the week, the yield had come down to 7.94%. This is a golden chance for those seeking to invest in Gilt funds as over a period of time, the rates have to come down for the economy to improve. Over a period of few months, all the losses would be recouped. What happened on Monday was a Black Swan event.
2. The Results of TCS, Axis Bank and Reliance have been good. The Good Results are always declared early and we may have come to an end of the above average results.
3. Nifty fell from 6229 to 5566. 6100 is the key level if the market is able to sustain above it then we may reach new highs. The Markets like to tease everyone hence we may overshoot 6100 slightly or have a small correction before decisively taking out 6100.
4. Last week was a study in Index Management. 1 day the IT stocks held up the markets, the next day FMCG stocks held up the markets. The broader markets were declining which leads one to beleive that a small correction can set in.
5. The FIIs have pulled out 1 billion USD from the equity segment and 1.8 billion USD from the Debt markets in the month of July. Till this trend reverses, markets will not make new highs.
6. The money is moving towards the defesives like FMCG ad Pharma which continue to make new highs while the rest of the market flounders.
7. The Banking stocks have been shattered in the last week, but the index has moved higher. If these stocks recover, then new highs are a given.
8. Gold continues to drift aimlessly and is a clear avoid at this stage.
9. If the up move was just a corrective up move to fall from 6229 to 5566, then it should terminate in the next week.
The Strategy remains to buy on dips especially the Banking stocks closer to 5900. One could also wait for 3-4 closes above 6100 to buy.
1. The RBI hiked interest rates in a surprise move on Monday to prevent the rupee from collapsing further. This led to the 10 year yield spiking up from 7.5 % to 8.1 %. By the end of the week, the yield had come down to 7.94%. This is a golden chance for those seeking to invest in Gilt funds as over a period of time, the rates have to come down for the economy to improve. Over a period of few months, all the losses would be recouped. What happened on Monday was a Black Swan event.
2. The Results of TCS, Axis Bank and Reliance have been good. The Good Results are always declared early and we may have come to an end of the above average results.
3. Nifty fell from 6229 to 5566. 6100 is the key level if the market is able to sustain above it then we may reach new highs. The Markets like to tease everyone hence we may overshoot 6100 slightly or have a small correction before decisively taking out 6100.
4. Last week was a study in Index Management. 1 day the IT stocks held up the markets, the next day FMCG stocks held up the markets. The broader markets were declining which leads one to beleive that a small correction can set in.
5. The FIIs have pulled out 1 billion USD from the equity segment and 1.8 billion USD from the Debt markets in the month of July. Till this trend reverses, markets will not make new highs.
6. The money is moving towards the defesives like FMCG ad Pharma which continue to make new highs while the rest of the market flounders.
7. The Banking stocks have been shattered in the last week, but the index has moved higher. If these stocks recover, then new highs are a given.
8. Gold continues to drift aimlessly and is a clear avoid at this stage.
9. If the up move was just a corrective up move to fall from 6229 to 5566, then it should terminate in the next week.
The Strategy remains to buy on dips especially the Banking stocks closer to 5900. One could also wait for 3-4 closes above 6100 to buy.
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