Markets succumb to Global cues, down 388 pts.

FII continue selling spree; Reliance, ONGC save the day

Nobody expected a miracle today and yes the Indian stock markets succumbed to the weakness prevailing in the other Asian markets. Markets opened with a downwards bias and selling intensified during the mid of the session with sensex tanking nearly 675 points intraday from yesterday’s close. However, heavyweight Reliance and ONGC helped the markets to recoup some of its losses at the later part of today’s session. Selling was witnessed across the breadth of the market. FMCG index suffered the most with 4.85% fall, followed by metals falling 4.31%. BSE Auto index suffered the least with 2% loss.

The markets would continue to take clue from Asian markets until fresh domestic triggers arise. Hardening Interest rates and crude oil prices are also contributing to the uneasiness in the markets.

Investment Guru is of view that the coming session would continue to be volatile for Indian markets with selling coming it at every rise. These are testing times for long term investors , however, investors are advised not to resort to selling under pressure and wait for markets to revive the momentum. Avoid overexposure to mid cap and small cap stocks as they would take much more time to recover as compared to large caps. Wait for clear signals from markets for revival of confidence and remain in cash for some more time to utilize opportunities in fundamentally strong stocks.

18 comments:

ravi said...

Hello rajesh,

As you say that we should avoid the mid caps,but please advice on the one that we had already bought.I am holding 500 shares of Aftek Infosys at a average price of 87 and now it is at around 63.What do you suggest for that particular stock.Also i hold tata infomedia at 220 now at 180.They offered a buyback and after that the management vanished in thin air.


Please guide......
thanks.
ravi.

prasoon said...

Hi Rajesh
The markets have taken its toll. Its falling everyday with losses piling up. Even the purchases made during the crash are proving to be loss making. What should I do now ? I have no cash left to invest further as i have poured most of it during recent crash. Please guide on what should be done now ? I am looking with lots of hope for your expert guidance.

thanks
prasoon
kolkata

Anonymous said...

rajesh sir,
you have very correctly said that mid caps and small stocks will be battered more and sir this is what exactly happening. BSE is up 60 points but mid caps and small cps are down 300 points. sir do you suggest that we exit at such low levels??? do you expect some pull back here so that we can make better exit and invest in blue chips. sir please reply.

Oldtimer said...

Dear Rajesh

Wishing you many Happy returns of the Day.

OT

Amit said...

Dear Rajesh,
Wish you a very happy Birthday and I wish the year ahead brings a lot of happiness and joy in your life. Thanks for your wonderful work on the blog.
Regards
Amit

Anonymous said...

Many happy returns of the day to Investment Guru !

Anonymous said...

Hi rajesh
Happy Birth Day to you and belated birthday wishes to your blog also which has recently completed one year. I still remember the day visited your blog first time and made my first purchase in stock market of Skumars.
regards
KK

Anonymous said...

Hi Rajesh,

Many Many happy returns of the day..

Manoj said...

Dear Sir,
wish you happy birthday. May god bless with you all hapiness and prosperity in your life.Please suggest one stock today to invest as your birthday treat !

Manoj

Anonymous said...

Happy Birthday :)

Anonymous said...

sir
when do you think this fall in markets will come to end Do you think markets will correct further

Rajesh Soni said...

Hi ravi,
Yes,I advised staying away from Midcaps since they look extremely weak. and you would have noticed that in last few days. the sentiments have turned extremely weak an dinvestors have lost confidence. Since mid caps were the star runners during the later part of rally they were the most vulnerable during the fall.

I do not track the stocks you have mentioned but going by the markets, you need to take a stand whether you are a long term investor or short term. If you have long term stand then hold on.If you cant wait , then sell it off since it is not going to go up in short term.

Rajesh Soni said...

Hi Prasoon
If you have no cash left, obviously you cant invest more. What you can do is restructure your portfolio, sell off the laggards and invest the money in fundamentally strong stocks.

Rajesh Soni said...

Thanks to everyone for the birthday wishes and for all your love and affection to the blog :)

sunil kumar said...

Dear Sir,
Today I finished all my remaining cash. I bought/averaged NTPC, BharatForge, WockLtd, RicoAuto, RCVL, PetLNG & Ranbaxy for medium term (November). I feel further downtrend is limited to 5%-8% since most of these stocks have corrected signifcantly. However, if it corrects more, is it advisable to add more cash???
Waiting for ur guidance pl.
Regards,
Sunil Sharma

Rajesh Soni said...

Hi Sunil

There are two phenomenon in markets, one is greed and other is fear. What we saw in last few months was greed, where people bought irrespective of valuations and what we are witnessing now is fear where people are selling like anything.

The best startegy in this market is to keep on buying in lower amounts at each fall. But do not make a mistake of adding position in momentum stocks as they will take much more time to cover up.
Enter in small quanitities in fundamentally strong stocks. The downtrend has been devastating for investors and it is difficult to find buyers even at current levels which further leads to fall in prices. Indian markets are currently following the global trend and a trend reversal in global markets should help overcoming this sitauation.

So keep a watch on global, especially asian markets. Dont expect markets to run up very sharply from here. It will take its own time. So take your time and invest only in good stocks.

sunil kumar said...

Dear sir,
Thanks for a prompt valuable response.
Can u suggest some good dividend stocks for long term investment at this stage.
Thanks again.
Regards
Sunil Sharma

Manish said...

Hi Rajesh
Markets have shot up by 500 points on friday. Is this the end of the bear phase or should we still be cautious ?
please advice.

manish