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Market Report

Thursday, 04-Apr-2013

NSE

  • Sensex, the BSE index, fell -1.55 percent, or 291.94 points, to 18,509.70 today, posting its biggest daily percentage fall since Feb. 26, and lowest close since Nov. 23, 2012. Nifty, the broader NSE index ended down -1.73 percent, or 98.15 points, to close at 5,574.75 today, posting its biggest daily fall since Feb. 28.

  • Technology shares led the losses as economic data from the United States, the biggest outsourcing market for Indian technology companies, pointed to a weak jobs market. Market fell sharply on worries that foreign fund inflows may drop on continued political uncertainty and likely muted earnings from companies.

  • Market participants are increasingly jittery that the current domestic economic and political situation can spark a broader sell-off by overseas investors who have pumped in above $10 billion so far this year. ETF funds are already making losses in India and with political uncertainty clouding investment climate, they are withdrawing money. FIIs can choose other markets which are doing way better than India. In the short run, India may go out of flavour as the government needs to follow through on the announcements it has made on economic revival and monetary policy becomes supportive of growth, they said.

  • Global risk appetite also remained frail after weak economic reports on hiring and service industry growth in the US fuelled concerns over growth recovery in the world's biggest economy. Asian shares ended mixed with Japan's Nikkei notching +2% after Bank of Japan's bold easing measures while Strait Times declined -0.3%. Markets in Hong Kong, Taiwan and China were shut today for a holiday.

  • The political scenario back home is not conducive to invest, said Deven Choksey, MD, KR Choksey today. If Advani says elections can happen early then it can happen, may be in November, he asserted.

  • The bigger concern for markets in the violation of 200-DMA and a decisive close below the 5600 levels on the Nifty, say experts. We have been maintaining negative bias on markets since the start of today's trade. And the fact that markets have moved below 200-DMA further downside is seen from current levels, says Mitesh Thacker. Investors should prepare themselves for a test of around levels of 5400 on the Nifty to about 5420 in the next few days and bounce back to about levels of 5620-5630 now would be good shorting opportunities, he added.

  • Do not try bottom fishing in the bear market, says Ashwani Gujral. The market is getting sold into and that is called a bear market. So try to remain on the short side like in a bull market. The person who remains long, the longest will make money; in a bear market the person who remains short for the longest time will make money. Be careful in finding value in bear market as bounce back will not last. It is fun when it goes up but when it comes down, chances are it comes down three times as fast as it went up, says Gujral.

NIFTY 3-Month

(Data/Charts courtesy NSEI/Yahoo!/iCharts/The Economic Times)