The Present Scinario

You may have never bought the bonds of Lehman Brothers or the shares of AIG, but your stocks get battered when these hallowed US financial institutions failed. Your investments, be it in equities or mutual funds or even gold, are getting eroded every time there is some bad news in the US. This is the irony of being part of a global financial system. Post liberalisation, world economies are more intricately connected, which means any development, good or bad, in one country will directly or indirectly affect your investments. The sub-prime mortgage crisis in the US has snowballed into a global credit crunch. The result: asset prices across categories and countries are biting the dust, and so is your personal wealth. However, there is a lesson to learn from the financial debacle in the US, which is a fallout of economic mismanagement at an individual level. It is, therefore, important to understand the genesis of the crisis so that you can manage your personal finances better. Crisis begins Let us first understand what happened in the US and why it took such a bad turn? Between 1953 and 2003, the US faced 10 big and small economic recessions. The recession intensified since 1970 after a steep hike in crude prices by the Organisation of the Petroleum Exporting Countries and the Vietnam war. The 85-month period between 1974 and 1981 in the US economic history is known as “stagflation” — a period of high inflation and stagnation in production — caused primarily because of high crude oil prices. To decrease the money supply and put a check on inflation, the US Federal Reserve increased interest rates steeply between 1979 and 1983. Many savings and loan associations took advantage of high interest rates and lent far in excess of prudent limits. The tight monetary policy in early 1980s inflicted a recession in the US real estate market and by the end of the decade, 2,412 out of 3,600 savings and loan associations became insolvent. The economic recession cooled inflation. After coming to power in 1982, US president Ronald Reagan followed an easy money policy, known as Reaganomics, characterised by sharp cuts in personal and other taxes, to boost domestic consumption and production to overcome stagflation. Though these measure improved GDP and employment growth, the Cold War led to a massive budgetary deficit. In the 1980s, the US government became the world’s largest international borrower. Around this time, the savings and loan associations started declaring themselves insolvent one after the other (Savings and Loan crisis), resulting in the great stock market crash in 1987. Problem deepens Throughout the 1990s, the US government followed an easy monetary policy and the Federal Reserve brought down its benchmark lending rate to 1 per cent in June 2000 — the lowest in 45 years — from 8 per cent in June 1990. With thinning spreads between their lending and deposit rates, banks and financial institutions resorted heavily to mortgage and other forms of lending ignoring the credit worthiness of consumers. Cheap availability of credit lured every US citizen to take a housing loan. This led to sub-prime (low or no credit worthiness) mortgage in the US. According to US census data, per capita disposable personal income (net of taxes) was $30,418 in 2005 but average annual expenditure rose to $46,409 in the same year. This means, people in the US borrowed more than what they earned to foot their consumption bills. From companies to investment banks, all drew up big expenditure plans on borrowed funds. In October 2004, the US securities market regulator suspended the restriction of net capital requirement to borrowed capital for Goldman Sachs, Merrill Lynch, Lehman Brothers, Bear Stearns and Morgan Stanley. Freed from restriction on debt, these five investment bankers borrowed as much as 40 times of their net owned capital. Dollar started flowing freely into securities and real estate markets of developing countries from investment bankers, asset management companies and hedge funds. Meanwhile, to disown the risks associated with their “unsound” mortgage and consumer lending, banks and mortgage lending institutions innovated debt securitisation and debt swaps that could be traded. These securitised debts and swaps were also insured by mortgage and credit insurance companies for the satisfaction of buyers. Seeds of a potential catastrophe were sown then and and the crisis deepened when the Federal Reserve kept on raising its benchmark fund rate from 2004 onwards to 5.25 per cent by June 2006. With rising interest rates, sub-prime borrowers started defaulting on loan repayments. Buyers of securitised mortgage debts suffered huge losses and some big investment bankers went bust while others had to be bailed out. Insurance companies also went belly up. Banks began to distrust each other with loans. The credit crisis followed. Taking stock So, what is there for the common man to learn from the whole credit saga. Excessive borrowing is a curse. Understand the interest rate risk first before borrowing money. Don’t just consider the EMI amount while taking a loan. When the interest rate goes up, your EMI will also rise, reducing your disposable income to the extent that you may be forced to use credit cards more often to meet your other expenditures. Use credit cards only in emergency and pay the bill during the free-credit period. Don’t roll over the credit or you will be caught in a debt trap. Don’t buy exotic investment products that you don’t understand clearly. Even debt and bond investments are not safe. In a crisis situation, debt and bond papers become very illiquid and you may not be able to sell those. Bond and debt investment requires a well-developed corporate bond market, which is absent in India. When it comes to investments, don’t follow the herd. Determine a return rate that will help you reach your financial goals. Once your investments generate the desired return, sell that investment and put the proceeds in some other instruments. Stock prices may surge further after you sell your holdings. But you won’t lose money when the stocks crash. Instead, you can buy some other good stocks at a much cheaper price. The current crisis may have come as a rude shock for many investors, but it will also help them to stay away from future financial misadventures.

Astrology

Ganesha had predicted on October 06, 2008 that circuit prices may prevail in the market. Relying on this prediction, those who finalized the deals accordingly must be rejoicing. This is the benefit of taking the astrologer's prediction into consideration before taking any action in the stock market. Till the last day of October the opening of Nifty will not be favorable, views Ganesha. Do not take any action till the day on which the opening of Nifty is positive. Mail me at dharmesh.joshi@ganeshaspeaks.com and order your reading now. Ganesha views firing crackers from the opening till 10:08. So do not be hasty and just wait and watch. Selling price may be around the circuit price. From 10:08 to 12:45 if Nifty is at the down fall then it may rise during this phase. From 12:45 to 14:45, in comparison to the previous phase, Nifty may fall. From 14:45 to 15:30, profit booking in heavy weight scrips is envisaged.

Depositers Pull out RS.17K from ICICI since march

ICICI Bank is shifting focus away from wooing bulk deposits as part of a strategy to reduce its cost of resources. Over the last six months, the bank saw an exodus in deposits following a cut in the lending costs. In the first quarter ended June 30, ICICI Bank saw deposit outflow of Rs 10,000 crore. From March till October 10, deposits fell by nearly Rs 17,000 crore. At the end of March 2008, ICICI Bank had deposits aggregating Rs 2,44,431 crore, compared with Rs 2,34,461 crore at the end of the first quarter in the same financial year. The bank’s deposit base stood at Rs 2,27,384 crore as on October 10. The largest private lender in the country has been reportedly looking at cutting down its dependence on bulk deposits since March last year, given the rise in interest rates. The proportion of retail deposits, which was 43% in March’07, rose to 46.5% in March’08 and is currently close to 50%. The bank did not make any special efforts to renew its bulk deposits. Over the past few months, the bank has cut down its lending activity in retail banking and is focussing on current and savings accounts. When contacted, ICICI Bank officials declined to comment. On a sequential basis, the bank reported a marginal decline in advances in the first quarter. The advances at the end of June were Rs 2,24,146 crore, compared to Rs 2,25,616 crore at the end of March. But other big banks have registered a rise in deposits and advances portfolio in the first six months. HDFC Bank saw a deposit growth of nearly Rs 30,981 crore from March 31 to October 10 this year. Courtsy: 25 Oct, 2008, 1112 hrs IST, ET Bureau

US govt stake in insurance

After purchasing shares of leading banks, the US government is considering buying equity stakes in insurance companies using the $700-billion rescue package approved by Congress,

The Wall Street Journal reported today. The newspaper said insurance firms were offering their shares themselves, feeling they could benefit from the government’s money pool amid the financial turmoil.

Citing people familiar with the matter, the journal said MetLife, Prudential Financial and New York Life Insurance were keen to sell equity stakes to the government. 

Yesterday, PNC Financial Services Group Inc said the treasury department would buy $7.7 billion worth of preferred stock and warrants.


Alpha Bank collapses In another sign of deepening financial crisis, Stearns Bank will acquire the failed Georgia-based Alpha Bank and Trust, making it the 16th American bank to fall this year.

On Friday, the US authorities seized the operations of Alpha Bank and the Federal Deposit Insurance Corporation (FDIC) was named receiver. “To protect depositors, the FDIC entered into a purchase and assumption agreement with Stearns Bank, National Association, St Cloud, Minnesota, to assume the insured deposits of Alpha Bank & Trust,” the FDIC said in a statement.

 In a separate statement, Stearns Bank’s chief executive Norman C. Skalicky said the current capital position of the bank is about $250 million. “We have over 23 per cent capital in our banking system today.

This is three times the average capital of all commercial banks in the US and four times what is considered being well capitalised,” Skalicky said. “We are pleased to bring the safety and soundness of Stearns Bank to the former depositors of Alpha Bank & Trust,” he added.

Courtesy-AFP

Global Economic Outlook For the year 2009

As the global economic crisis unravels, many people are asking questions about future. Some are claiming that worst is already over while others forecasting the far worse conditions to set in. This article is an effort to look at global economic outlook from astrological perspective. The series of Bank failures and liquidity crunch was caused by the Saturn in Purva Falguni Nakshatra. Now thankfully, Saturn is going to move out into Uttar Falguni Nakshatra during November end. This will certainly result into improving liquidity scenario across the world. However, the trine aspect of Jupiter on Purva Falguni will also end and with that the government's focus will move away from strengthening the banking system, as other serious issues will begin to crop up. However, the overall effect of both these movements is likely to be positive and will result in easing out of liquidity situation. Trine formation between Saturn and Jupiter in November end, may cause events providing the boost to the sagging morals of the financial markets. As Jupiter transits into Capricorn during mid December, it will begin to give rise to inflationary conditions especially with respect to industrial commodities. It will present a serious inflationary threat to the global economy. In recent times, there has been a lot of talk of deflationary threat among economists worldwide and to some extent, it has been the supportive factor for the interest rates to come down heavily in pat few weeks. However, astrological positions show that inflation and not the deflation is the serious threat. As Rahu is currently positioned in Capricorn and now Jupiter will also enter the same sign and they together will build serious conditions for upsurge in commodity prices, which may assume serious dimensions during mid Feb 2009, as Jupiter and Rahu gets exactly conjunct. Meanwhile, Saturn in Uttar Falguni Nakshatra will force the governments worldwide to take care of issues related with general masses. Till now, governments have only tried to handle the situations related with asset deflation and banking stability. Now the focus will shift to handling public grievances and new packages will be designed worldwide to provide solace to masses. Such plans will also cost lots of money to the exchequers. As the government funds worldwide have almost disappeared in the recent rescue acts, this new funding has to come by way of printing fresh currency, which will cause serious inflationary pressures. Positioning of Ketu in Cancer has already caused serious agricultural inflation and hence transit of Saturn in Uttar Falguni will further add fuel to the fire. Hence it seems that a major inflationary scenario is building up at this stage. As Saturn enters Purva Falguni again in the beginning of February, serious inflationary pressure may cause the interest rates to rise. Saturn will be in Purva Falguni till mid of August and it will force the central bankers to go on a series of interest rates hikes to quench the fiery inflationary scenario. Rahu along with Jupiter will continue to be in Capricorn till first half of November. This astrological combination combined with Saturn in Purva Falguni will force the series of interest rates hike till November 2009. Jupiter will move out of Capricorn in between in the period of May–July and hence it will be placed in exact opposition to the Zodiac sign of Leo. Hence, this may be the time for temporary bottoming of asset prices, even though a meaningful bottom will be established only after Jupiter finally moves into Aquarius during December end. As Saturn enters Uttar Falguni again in the period of Mid August, new financial regulations will come in place, in response to the huge public outcry. Since Pluto is also placed in Mula nakshatra, there will be serious rethink about the extent to which speculations should be allowed in the economy. This will lead to very tight norms and even banning of speculation in next few years to come (till Pluto remains in Mula nakshatra, which is ruled by Ketu). As Saturn moves into Virgo by mid September, the serious depressionary conditions would begin to engulf the masses into serious bouts of unemployment, food riots, social conflicts and other such issues. Ketu in Cancer will also be aiding such a scenario. This situation will only begin to ease out, once Ketu moves out of Cancer in the beginning of Nov. To sum up the whole scenario, it seems that the crisis has just begun and year 2009 will bring serious repercussions, as the crisis begins to spread from financial sector to real economy. It seems that by September, the recessionary conditions will worsen into depressionary conditions. As central banks are forced to print currency to fund their rescue packages, the inflationary pressures will begin to take its toll. There will also be serious upward pressures on commodity prices fueled by speculation and aided by series of rate cuts, which will force the banks to reverse the cuts and go on a series of interest rate hikes. There will be norms to curb the speculation and the so called sophisticated financial instruments will face serious restrictions or even phase out. Crisis will enter the public domain and will lead to social conflicts during last quarter of year 2009. Asset prices will only begin to stabilize during the year 2010 and that lead the economic bottoming out process. Banks will have to sell the holding of gold and hence its price will also crash, in spite of the inflation and dollar weakening scenario. Stock markets will continue to witness the downward spiral, even though at the slower pace. Commodity prices will witness sharp up moves. Dollar may collapse, which may provide a helping hand to the falling crude oil prices. Even though the Indian economy is quite robust, it will still yield to the global pressures and we may witness serious slowdown and strong inflationary scenario. It appears that Indian stock markets along with other emerging markets will bottom out before the developed markets. There is a likelihood of striking the bottom around May-August 2009. Weakening dollar will put exert extra pressure on the price of gold and hence there can be a substantial crash of gold prices in Rupee terms. courtsy- Playful Mystic Shivo

Rupee vs Doller

The rupee tumbled to a historic low of 50.15 to the dollar before scuttling back above the psychological barrier on a day of skittish trading. The fall in the exchange rate coincided with the meltdown in the stock markets and the sharp appreciation of the US unit against other currencies. However, the Indian currency managed to erase some of its losses and ended the day at 49.96 per dollar after the Reserve Bank of India (RBI) intervened heavily by selling dollars. Some estimates said the central bank sold more than $3 billion today. Dealers said the tide was against the rupee right from the word go, and it resumed lower at 50.01 a dollar from its last close of 49.82. Pressure on the rupee built as foreign institutional investors (FIIs) continued to take their money off the table and sent it home. Foreign banks were aggressively buying dollars as the greenback hit new highs on world markets. Analysts, however, feel that the Indian currency may remain under pressure in the days ahead though its movement will also depend on intervention from the central bank. Urvi Gandhi, analyst at Mecklai Financial Services, said the near-term prospects for the rupee appeared to be bleak as the sentiment was bearish on account of the liquidity crunch and the global economic slowdown. Gandhi said the rupee had taken a dive because the FIIs were no longer bringing dollars into the country. These investors have so far sold more than $11 billion of domestic stocks this year. The RBI has added to the gloom by scaling down domestic growth estimates from 8 per cent to a range between 7.5 per cent and 8 per cent.

World Picture

Wall Street joined a global market rout on Friday that kicked off in Japan, led Russia to suspend trading and sent oil and other commodities tumbling on fears of a deep worldwide recession. The US stock indices fell around 4 per cent. News of a contraction in Britain’s economy fuelled fears of a worldwide recession stemming from the worst financial crisis in 80 years. China warned the outlook was grim. Foreign exchange markets saw extreme volatility with the yen rocketing to multi-year heights against the dollar and euro. The euro/yen rate fell 10 per cent at one point. Britain’s economy shrank 0.5 per cent in the third quarter, and analysts said euro zone figures showed the 15-nation currency bloc was already in recession. The pace of existing home sales in the US rose sharply in September, but a Reuters poll of economists suggested battered US home prices would decline next year and a possible recovery in 2010 would be meek at best. Stock markets went into a freefall around the world as panicked investors moved to liquidate risky positions. Japan’s Nikkei index ended down 9.6 per cent and European shares dropped 6.5 per cent. The Dow, the S&P 500, and the Nasdaq dropped around 4 per cent each. The price of US government bonds rose as investors exited stocks. “I would characterise this as a shell-shocked mentality out there,” said Thomas di Galoma, head of government bond trading at Jefferies & Co. in New York. “It’s all the deleveraging of equities ... It’s causing an issue for everyone.” Russia suspended trading on its stock market until at least Tuesday after the market lost more than a tenth of its value on Friday, hitting its lowest levels since late 2004. “The global financial crisis has been constantly spreading and worsening, creating a severe shock to global economic growth,” Chinese Premier Wen Jiabao said at a meeting of 27 member states of the European Union and 16 Asian nations.

Gold Story

Gold prices tumbled both at home and abroad, making a mockery of the status of the yellow metal as a safe haven. According to the World Gold Council, when the financial crisis had started and stock prices fell, investors had scrambled to buy gold. However, now that the crisis has deepened, investors have lost confidence in all assets, including gold. The price of the yellow metal in the international market today fell below the $700-mark to $695.10 a troy ounce — its lowest in the last 13 months. In domestic markets, the price of gold (24-carat) slipped to Rs 11,825 per 10 gram in Calcutta from a peak of Rs 14,565 on October 10. The returns from gold exchange traded funds, another vehicle to invest in gold, also fell over 18 per cent in the last fortnight and 11 per cent in the last one month. Besides, anybody keen to sell jewellery will find few takers among gold retailers. “We’re buying gold jewellery till October 28 (that is Diwali),” said a spokesperson at P.C. Chandra Jewellers’ Bowbazar branch. An official at Anjali Jewellers said it was buying jewellery made only by them. We are not buying jewellery made by other jewellers”. An official of the West Bengal Bullion Merchants & Jewellers Association said the jewellers were sitting on a large inventory.

Experts Openion Over Market

Raamdeo Agrawal of Motilal Oswal feels that it could take two years for the market to come back to normal. He said investors must exercise control and not go into panic mode. Agrawal added that it is difficult to say at what levels prices will stabilise. Typically, two years after the bull runs are worse, he said. He feels one and a half year of further pain is still left. He said that the bear market is expected to last for 12–18 months. Agrawal said that there has been massive increase in corporate profits in the current bull run compared to the phase in the 2000s. Here is a verbatim transcript of the exclusive interview with Raamdeo Agrawal. Also watch the accompanying video. Q: What is your take on what is going on in the market today? A: I have never seen anything like this. I have seen three cycles––1985, 1987 and then 2000, and now this. Every time the feeling is different, the story is different, complexity is different. This time is absolutely stunning. No parallels can be drawn in terms of valuations. One can get companies at one-third of the book overnight. So, these are unusual times. I cannot even structurally think how to think about it except that one needs to control their behaviour at this point, and let the storm pass. Q: Where will it stop? We went out from 3,000 to 21,000, and we have already gone back to sub-9,000. How much will the clock be turning back? Do you think by the time this is done? A: If one looks back at the last 12–15 years, one of the things that comes out is that these are boom and bust kind of markets. Every seven years we have a cycle–1985, ’92, 2000, and 2007. If one does the market capitalisation to GDP calculation, on the last two occasions, the market went to about 55–60% kind of market to GDP at the top and the bottom was formed at about 25% to GDP. This time, thanks to global participation, low cost of money and F&O, the market expanded to 180% of GDP. The expansion went from Rs 8 lakh crore to 75 lakh crore in five years. So, that is the size of the party we had. Even till yesterday the valuations were at about Rs 31 lakh crore. Today, it must be more like Rs 27–28 lakh crore, which is still about 60% to GDP. So, we are still in that kind of broad valuations, which is more than 50% below the peak we saw. I would not like to predict where it will really stabilise, but I am just giving you a perspective. Q: How long would it take after this kind of damage? We had damage in the last bear market as well but this time it seems the damage is far more widespread. How long would it take for the market to finally get back on its feet? A: Typically, in the first year post the bull run, we saw the peak around January 15, is a non-negotiable kind of thing. Looking at the spread and diversity and intensity of the whole problem, it could be two years and post the dotcom bust it took three years. Literally, from 2000 to 2003 we lived in a bear market, which was unprecedented. So, the pain was very deep and prolonged. However, two years is a good period to think about at this juncture. We are not even a year right now into this. So, at least one to one and a half years of painful journey is ahead of us. Q: From the past bear markets that you have seen in 1992–2000 and some of the past bear markets that you have read about, do you sense that this one is pretty much in line with those severe bear markets or does it give you any reason or sense that this may be actually a little more abnormal. Do you feel that there may be further weakness and that it won’t pan out the way most bear markets have panned out in about 7–8 year cycle? A: One of the differences this time is that earlier bull market followed by the bear market were not associated with very strong earnings in the corporate as is in India. This time if one looks at the P/E side it never went into crazy levels, it remained at 18–19–20 times. So, the whole thing was filled up. Corporate profits in 2002–2003 were more like Rs 40,000 crore. This year in 2007–08 full numbers we have is about Rs 3 lakh crore. So, there is a massive expansion of corporate profits in 2002–2003 and 2007, so that is the difference at this point of time. I think P/E wise, corrections are more or less are at a very comfortable level. The biggest challenge is how the profits shape up for the corporates going forward from here, that is a different thing. I think the pace of decline is absolutely breath taking, you are coming down 50% but 50% in five days and 50% in 150 days, I think there is a difference. Q: Has the correlation of equity markets across the globe increased in comparison to the bear markets you have seen in the past and perhaps that is why there is so much mayhem and confusion? A: It looks like businesses have become much more integrated globally and capital has clearly flown from one part of the world to another. What is happening in the US is not my business kind of a situation here. So, if Lehman or some global major falls, I think there is a kind of related thing here or if the emerging market equity volatility index goes up there and the papers have downgraded, I think there is clearly an impact here in terms of cost of equity or debt out here in the local markets. So, I think the whole world has become much more integrated and globalised and hence one has to take all the flak. We might emerge much stronger at the end of it as a country. However, I think the way, the psychological damage of fear cannot be escaped. Q: There is this old adage that when blood is running on the street or fear is at its highest levels. Would this be a great time to buy? In the long-term, would you make some bit of money? A: The problem right now is what earnings we have for the last four quarters­­––that is the real thing. But, what we are going to see in next quarter and the quarter after that is going to be very different most likely. So, earnings to bond yield right now is holding at 1.35–1 in the regulation I did 3–4 days back. The worst in 2002–03 was about 1.7–1.8, so we are very rapidly reaching there and after reaching there it takes another 1–1.5 years to bottom out. So, one is reaching the under valuations and then staying there, so that all the people who are hurt psychologically have to get out and make a way for completely new corporate culture, new earnings culture, new interest rate, new commodity cycle. There will be lot of things changing this time. The story is different this time but it goes on in equity market.

Madhusudhan Kela, Head-Equity Investments, Reliance Mutual Fund feels this sell-off looks like a final capitulation. However, he said this could not be termed as a bottom for the market yet. He does not see any redemption pressure in mutual fund and said that they are sitting on around Rs 5000 crores. Kela advises investors with a 3-4 year perspective to buy into this market as some companies are now available at one third of their cash balance on their books. Sudarshan Sukhani of Technical Trends believes the markets have seen the worst of all damages today and does not expect it to go lower today. He expects a bounce bank and said there would be a tradable rally in the Nifty. However, he is unsure about when that would happen. Sukhani does not recommend short selling in the market and advices investor to either stay away or muster up the courage to go long. Technical Technical Analyst Ashwani Gujral said, “We have strong support between 2,600–2,650 levels. So, probably the market will stop out there but one will not get as meaningful a bounce as is there on most support levels. However, finally, the market will go through 2,600 and may sort of test those 2,000–2,200 levels on the Nifty which was a significant break out level. That was a previous market high.” Gujral further said that the way Kospi, Nikkei and all other Indices are falling around us these local support levels don’t count for much. He feels that in bear markets, support levels don’t hold. He added, “We have seen how from panic levels, one have panics every week. So, it is time to wait and let this pass.”

Market Summary

It was a crash across global equity markets. It was mayhem on Dalal Street and the bloodiest day ever, a black Friday. Sensex closed at 8639, down 1131 points (provisional) and Nifty at 2557, down 385 points (provisional) from the previous close. CNX Midcap index was down 8.31% and BSE Smallcap index was down 7.76%. The market breadth was negative with advances at 108 against declines of 1172 on the NSE. It was a global meltdown today as markets across the world crashed - Germany down 11%, France down 10% and UK down 9% (technically UK is under recession as its GDP was down 0.5%). The Dow futures hit unit down and saw single massive sell off. Hong Kong slid to four-year lows. The pain was across Asia as well. For the Indian market it was the lowest closing for the Sensex and Nifty since 2005. Sensex shut shop at 8701, down 1070 points and Nifty at 2584, down 359 points from the previous close. CNX Midcap index was down 8.11% and BSE Smallcap index was down 7.66%. The market breadth was negative with advances at 87 against declines of 1196 on the NSE A lot of tears to be shaded it seems in very near future.

Astrology

Friday, 24 October 2008 From the opening till 11:00 you should not take any action. There will be no gains for you through any new action taken by you. You can see the weightage in the bracket. From 11:00 to 13:00, you can trade according to the personal reading based on your horoscope which I have sent you. From 13:00 to 14:25, due to buying in Nifty the market may rise. It is difficult to say whether it is a bullish trend. From 14:25 to 15:30, Ganesha views that, ignoring one instance where Nifty will rise, Nifty may lower down. Ganesha advises you to be very cautious during the next week.

Market Watch

The Asians markets closed with deep cuts. The European markets continue to bleed badly. The Indian market has seen panic with relentless selling across the board. Sensex is trading at 8774, down 996 points and Nifty is at 2613, down 329 points from the previous close. CNX Midcap index is down 7.88% and BSE Smallcap index is down 7.15%. BSE Realty index is down 15%, BSE Bankex index down 13%, BSE Metal index down 12% and all sectoral indices are in the negative. The market breadth is negative with advances at 77 against declines of 1203 on the NSE. Opec has cut its production output by 1.5 million barrels per day. Crude is trading at record low of $64.83, down 4.44%. RBI will infuse liquidity if necessary and continue to deploy conventional and unconventional tools to manage the situation, says Finance Minister P Chidambaram. RBI has retained flexibility to act swiftly as and when required, he says. RBI leaves key rates steady and it is necessary to remain calm and confident to ride the crisis out, he feels. Our financial system is healthy and economic fundamentals strong and we are affected by the ripple effect of the global crisis, he adds. Once calm returns to the global markets we will return to our growth trajectory, he believes.So friends be ready to accept the present situation.We are heading towards 2000(Nifty) with in oct'2008.This will happen only due to Panic.

Stock Market

Friends, we are heading towards a bear phase for 2 years onwards now.
Do select your investment very carefully now. Don't get panic while selling or buying.If you become a invester rather trader you will win in all respect.
Regards
Kaushik Dutta