How remarkably the Sensex has crossed the 17000 mark. It took just 15 session for it to acheive this feat. However, last time when it performed the coverage of 1000 pts between 16000 and 17000, the time taken was just 5 sessions of trade. Why does the pace advance between 16000 and 17000, the answer lies in the fact that 1000 devided by 17000 is a figure under 0.6 (or say under 6pc). This can be taken to be as nearly five percentage and this much percentage movement does not make one sit up and gasp. A movement at over 6pc is rounded to 10pc in popular perception and is taken to be some thing extraordinery. You will notice that movements hereafters on the upside will be rather fast in terms of time taken to cross the next 1000 points. An other pointis that upto the level of previous highs, the groove exists and it does not need to excavate to move ahead. Beyond the previous high level it would have to be trying hard or let us say it would take a spate of high potential news at that point in time to enable it to move further ahead.
Bharti-MTN deal has been aborted. They say it was the insistance of SA about duel listing, may be so but I haven’t heard any body say that the statute there does not bar it and what SA is insisting is extraneous. If the later is the case then why should an Indian company expose itself to risks in an irrational and unhealthy place. As I told you earlier, I do not find much of substance in the deal for the stake holders other than the comfort to Mittal himself as promoter to be able to withstand the local political pressures by posing to represent international interests. India’s potetial is still not exploited to the hilt then why spread thin the effort and resource. It was themistake committed by Tatas, the Birlas and few others and they had to face tough times. Also I say that the business rules in India should be firmer and less prone to changes every now and then. The businessmen here should be taken to task for breaking rules but should not be subjected to either please the establishment or face (harsh) music. Again, if the deal failed because India has still not graduated to having full/free convertibility of rupee, it is an occassion to do it and just not have fearful attitude. You can’t have a grim face and smile too.
The IPO by Oil India commands 9.3pc premium over issue price. Can’t just yet whether its good for investment. I have to have a track record of some quarters to be able to do so. That’s why you do find coverage of newor small companies in the ‘panch-tattva/post result’ catagory. I am pleased to say that my system has gained credence and a few of my readers have informed about having made money, relying on the advice.
The Nifty PE (at 20.59) is still not in danger zone because the profitability has kept pace with the market. If the second quarter does the same than rosier times are ensured in future too. The only hick up is that those who bought equities between Oct 08 and Mar 09 would like to encash chips without subjecting themselves to capital gains. Even other old holding would find way in to market for similar concern. The new tax code is a bad omen for the market.
There is some weakness in the Asian markets today and so was the case in USA and Europe yesterday. We may be impacted to some extent today but not much. The result season holds the key in our case.
The China is celebrating its foundation day. What an irony, the foundations of that time have no trace now and still the foundation day is being celebrated. China turn into a market economy from a economy under shackles has been dramatic. What is more surprising that it has still not heard the noises about democracy even though the stomachs there have been more than full for quite some time now.