Sunday, October 5, 2014

H1 2014 Results the next trigger

In an extremely short trading week of only 3 days, the markets barely moved. Monday also is a trading holiday. There are no short term triggers for the market either up or down. Let us see what could unfold over the next few days.

1. The next week begins with a holiday and the H1 2014 results will trickle in only after next week. I expect next week to be another listless trading week.
2. The week starting 13th October is going to be a action packed week with H1 2014 results coming in and election results on October 19th 2014. The week after that is the Diwali week and if any pre-Diwali rally if it has to start has to start very soon.
3. Globally, crude oil prices have dipped and there is actually over-recovery of almost 2 rupees for diesel. This means thanks to model code of conduct the Government cannot cut diesel prices even the previous under-recovery is being covered. This bodes well for the fiscal deficit.
4. The robust car sales point to change in sentiment. As I see it as per the 8 year cycle, we should peak out between November 2015 to February 2016.
5.Gold prices continue to make fresh lows. This indicates a lack of fear in the world markets.
6. The FIIs bought about 5000 crores worth of shares in September and the Domestic funds picked up 16000 crores worth of shares. In spite of pumping in 21000 crores in the markets, they moved up only 0.1 pc for the entire month. This indicates fatigue at higher levels ad local operators booking out.

It is time to stay on the sidelines and watch the markets. At 7945, it does not make such sense to buy as well see. If one had to sell then the last 1 month presented much better opportunities than now.

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