The Professional Ticker Reader TM

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March 13, 2004

Markets tank further. Sensex plumbs 180 points.

Sentiments take a hit as global outlook softens.

Weekly statistics

Indices	Open	High	Low	Close	Change
BSE - 30	5899	5951	5570	5700	179.95
BSE - 200	760	776	729	743	14.75
NSE - 50	1868	1898	1775	1812	55.50
Dow  Jones	10240 356	Nasdaq	1985 63	FTSE	4467 80
Advances	4897	Declines	8215	Put / Call trades - 46,085 : 1,06,483
FII Investments	Rs + 1534 Crs Mar 1 - 11		Domestic Funds	Rs + 57 Crs Mar 1 - 11

The BSE & NSE combined weekly value of  shares advancing was Rs. 15,987 crores and the value of shares declining was Rs. 23,579 crores. This indicates a broader selling bias. The total weekly traded volume on the BSE was Rs. 12,965 Crores ( previous week Rs 12,844 crores). The total traded volume on the NSE was Rs. 26,674 Crores ( previous week Rs 20,974 crores). The figures are not really comparable as the previous trading week was shorter by 1 day due to a holiday on March 02, 2004.

The markets saw a weak trading sentiment as the undertone remained brittle. The diversion of funds from the secondary to the primary market and the weak overseas markets took their toll on the sentiments. The market breadth was negative and the traded volumes were marginally higher than the previous week. The technology sector along with select index heavy-weights dragged the markets lower and bulls preferred to offload positions on all advances. The Sensex  was boosted by Dr Reddy and Hindalco. The Sensex  was dragged down by ACC, Bajaj Auto, Bharati Tele, BHEL, BSES, Cipla, Grasim, Guj Amb Cem, HDFC Bank, HDFC, Hero Honda, Hind Lever, HPCL, ICICI Bank, Infosys, ITC, L&T, ONGC, Ranbaxy, Reliance, Satyam Computers, SBI, Telco, Tata Power, Tisco, Wipro and Zee Telefilms. The rupee ended the week at 45.25 levels ( 00.04 ) against  the US $. Overall, the week was in line with our expectations. Click here to view the previous weeks file.

Top I Derivatives guide I Likely triggers I Technicals I Reco's I

The markets are likely to remain cautious as the undertone is brittle. The markets have gone down with marginally higher volumes ( though the figures are not really comparable due to a holiday last week ) and the market breadth has been negative. The FII inflows have remained positive though the consistency of the inflows has been erratic. The F&O figures also show a lack of conviction as the bulls have been hesitant to enlarge commitments at lower levels. The trading pattern shows an interesting picture - of the entire traded volumes last week, only 20 % was on uptick days ( Monday March 08, 2004 ) the remaining has been on negative market breadth days. This belies an underlying weakness. The worries on the IPO's and advance tax payments have been discounted and barring the year ended considerations for mutual funds to support markets on NAV management considerations, there is an absence of positive triggers. The reduction of contract sizes in select scrips may see higher participation from retail players, but the undertone still remains nervous.

The overseas markets have been extremely weak and have cast a shadow on the sentiments. We expect the upsides to be limited as selling pressure will be felt on all advances. The overall outlook will remain that of abundant caution. Click here to view the previous weeks file.

Top I Derivatives guide I Likely triggers I Technicals I Reco's I

The weekly bar chart of the Nifty shows a support near the crucial bottom of 1750 levels. As we had accurately predicted last week, the Nifty has bounced back from this support level. The resistance levels specified last week at the 1900 levels has proved to be a melting point which the markets will have to surpass convincingly with higher volumes and a positive market breadth to signal a reversal from the current weak trend. Click here to view the previous weeks file. What is apparent immediately is the lower tops formation which the index has been making. This pattern needs to be broken for an effective rally to commence all over again. The oscillators are pointing towards a weakness which raises the probability of selling pressure on all advances. Unless this pressure is absorbed and the markets rally past the 1900 mark, remain cautious in the coming week.

Our outlook on the Nifty is that of caution and traders need to watch out for a breakout on the higher side before taking fresh commitments.

Top I Derivatives guide I Likely triggers I Technicals I Reco's I

Have a profitable day.

 

Vijay L Bhambwani

Ceo :- Bsplindia.com

The author is a Mumbai  based investment consultant and invites feedback at Vijay@BSPLindia.com and  ( 022 ) 23438482 / 23400345.

SEBI disclosure -  The author has no positions in  the stocks mentioned above.

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