Sunday, March 8, 2015

FIIs pump in the money

It was a truncated action packed week along with a RBI rate cut to excite things. The markets were up 0.4 pc in spite of the rate cut. Let us see what the coming week brings for the Indian markets.

1. The FIIs bought almost 4000 crores worth of shares in the first 4 days in spite of which the markets moved up 0.4 pc. That means someone sold big time. That someone can be the domestic institutions or the operators. (DIIs actually bought about 1000 crores also).

2. The RBI rate cut was sold into. It was a classic sell on news kind of event. Usually, the markets rally and sustain a rate cut news.

3. In March around the 10th of the month, people start pulling out money for the Advance Tax payments. This is a reason why the markets remain subdued during this time.

4. Also, now is the time people start to book losses so as to balance the Short Term Capital Tax payments.

5. The Telecom Auction is going as per expectations. This can be a positive trigger for the markets but a negative trigger for the Telecom companies.

6. The major news is out of the way. If the Rajya Sabha passes the Insurance Bill, then the markets will rise.

7. The markets have corrected from 9119 to 8849 a fall of 270 points from the top. Average falls in recent times have been around 500 points. If this fall exceeds those falls then I expect a 1000 point correction any time between now and June 2015.

That correction will be a buying opportunity. I hope some of us managed to book profits during the up move around the budget time.

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