Market catalyst.... -- September 30, 2008

Market catalyst.... -- September 30, 2008
Market opened with fear never heard off though we had warded off going short because it was not in the interest of traders. Hedge Funds were sellers in the market for last three days to the extent of 4000 crs which was absorbed by some European, Japanese and domestic funds. Govt sources say that the market has bottomed out and the crisis in Indian market may not persist. May be this is the reason LIC is single largest buyer in the market. RIL treasury mopped up more than 3.5 mn shares of RIL in last 3 days.

All said and done do this mean the pain is over for now…? May be or may not be. But 12300 to 13000 has become a benchmark index like Dow was at 10600 to 11000 for last so many months. In India short sellers have done all that which they wanted to do to break the 12300 mark which they failed miserably today and market after opening down for 500 points recovered by 400 points at one stage and closed at 264 points.

This squarely means the selling is getting absorbed at this juncture and therefore this should be considered as the rock solid bottom unless it breaks and closes below 12300 from where market will enter in no man’s land and it could collapse another 1000 to 1500 points. But it seems very unlikely. Traders should become active once market crosses 4320 which could happen in this month only.

After touching Rs 47 Adhunik metals rose to Rs 63 which means the selling got over. Morgan which was buyers till Rs 180 was sellers till 47. This is the saga of FII’s in India. You must pick stocks where FII presence is not there at all.