On ICICI Bank:

The market has such conviction in hammering a stock down so continuously despite all sorts of clarifications coming in. Look at the sequence of events. The management has clarified not once, not twice, but thrice. The RBI has clarified; the Finance Ministry has clarified that ICICI Bank does not face any kind of problems, and yet the stock falls at the rate of 20-25% a day, which tells you that the market probably knows something that we do not.

The market is a very clever beast. When clarifications are given and the market takes it on board, then there is no reason to fall like this. You can see that ICICI Bank probably does have a fairly reasonable liquidity position if not an utterly comfortable one. It doesn’t seem to be in any kind of problem that western banks seem to be in. Yet the stock price is falling.

I doubt whether this is any kind of concerted bear hammering or anything like that. My fear is that the market knows something that we are not aware of today, which might unfold over a period of time. I hope that the market has got it wrong. For the moment, we take the management’s clarification at face value, and it doesn’t appear that ICICI Bank has any kind of liquidity problem or is about to go belly-up or anything like that – far from it. But the screen makes you worry quite a bit about how things are progressing.

On Infosys:

Infosys is a conservative company, and it always has been and will continue to be. Therefore it is no surprise that it has come out and said that it needs to lower its dollar revenue guidance and dollar profit guidance.

It is important to understand why the market is focussed on the dollar revenue guidance because the market pretty much wants to know at this point what Infosys’ take on the business flow going forward is. It is not worried about reported numbers, whether because of the rupee versus the dollar or the dollar versus the euro, the reported numbers in rupees moves up or down. It wants to know whether core business for Infosys is going to slow down dramatically.

Principally Infosys bills in dollars. Therefore the dollar revenue and the dollar profit guidance is what the market is taking as a proxy to what Infosys thinks about its business going forward and maybe justifiably so. That revenue guidance got cut down 5%, the profit guidance got cut down 5% from its peak, and that worried the market quite a bit.

Infosys fell to Rs 1,050 in the morning and maybe it will not fall below Rs 1,000 because it gets valuation comfort, it goes into single-digit P/E multiple something that we have never seen in Infosys, and maybe it will not fall. So, the downside could be restricted to Rs 1,000. But upsides I suspect will be capped from here about Rs 1,300 odd because of the kind of murky visibility in dollar earnings that one is seeing, and what the management confirmed today.

On markets this week and the week ahead:

Enough damage has happened this week in four trading days to lose 15%, which is something that one doesn’t expect. I have been saying throughout this week that the market seems a bit overdone on the way down, and at least a technical pullback is likely and plausible. That has not come this week. That expectation has been belied. I hope it fructifies next week.

So, I don’t know whether next week again if there is more global turmoil tonight, the Sensex and the Nifty fall further and maybe the Sensex falls to sub-10,000 levels, and from there maybe there is more regulatory action, and the market moves back. But essentially for the moment, it appears that between 3,000 and 3,800 Nifty, and between 9,000-9,500 on the Sensex on the way down, and I suppose 11,000-12,000 on the way up, the market is probably rangebound. There could be more downsides. But on a day-to-day basis it is very difficult to predict.

For investors probably it is too late to sell. We are less than half of the index level of January. I think if you haven’t sold already you can hardly sell stocks that are down 80% from their peak values. So, it is tough to sell at these prices. Is it easy to buy? Not quite yet. So, I think investors should probably sit on cash, and not sell in a panic. They should probably not do anything and just watch the situation unfold over the next few days.




-Udayan Mukherjee, Managing Editor,CNBC TV18...

On the market mayhem:

It was not one of the worst weeks – it was the worst week ever. The market down 15% is as bad as it gets. It is completely unprecedented and unexpected. One does not expect to see largecap names lose 25-30% of their market cap in just one trading session flat. That’s exactly what has happened today and there are lots of reasons and lots of things which have happened in the market from Infosys, to the cash reserve ratio (CRR) cut, to the Index of Industrial Production (IIP) number, to the Finance Minister and the SEBI statements – it has been very eventful as a day.

But at the end to look at stocks like Reliance Communication down 23%, ICICI Bank down 20%, Reliance Infra down 20% - stocks in the index giving up 1/5th or 1/4th of their market value in a single session, tells you what path sentiment has come at, at this point in time. So global panic, bad local macro numbers and nobody wants to buy – there are only sellers in the market – this is classic capitulation and a bear market in full flow.

It was debilitating week for sentiment and while it has been looking oversold technically for the last couple of days, but that’s not making any difference as one can see on the screen.

On IIP numbers:

The number could be one-off but we have seen a fair number of poor IIP numbers over the last six-months. Some numbers have been okay, some have been pretty bad but the message is clear that things are slowing down quite substantially in the economy. There is no doubt about that and one would see repercussions of that not only in GDP growth but also in earnings growth – that is something which is worrying the market. So that 1.5% number might be an aberration.

It may or may not be but a lot of people in the market and in the economy seem to be in denial mode as well. They refuse to take on board any poor economic number, just wishing it away as a bit of an aberration and focusing only on the good numbers which come in.

I think the message is quite clear even if you look at or tab the newsflow from the ground that things are slowing down quite substantially and we may end up with a macroeconomic backdrop which is not as favourable as people would have us believe. That number hurt sentiment quite a bit and the market is quite convinced that things are indeed slowing down, this IIP number being an aberration not withstanding, which is why despite several protestations and clarifications from various sources, the market still closed down 7% and I wouldn’t be so sanguine that the market has not got it right.

On CRR cut:

The Reserve Bank of India is doing the right things. First things first, it has to inject more liquidity. It will have to do more. So I wouldn’t be surprised if more CRR cuts come in the next fortnight I wouldn’t even be surprised if interest rate cuts also happen, though that it is not consensus expectation at this point in time. But as one has seen in the west, these things are not quite working. They need to be there. The market takes on board, accepts the large – which is being given and then just hammers stock prices down even more.

So while this is a help, it will ease liquidity in the system – may be cool call rates a little bit – but bankers have been on record saying that this will not ease lending rates in the system and banks might even choose to hold on this liquidity and not lend it out because of the kind of industrial growth situation they are witnessing. So it is not like this money will come into the system. It might just lie with banks who might want the cushion of extra liquidity at this point in time. Will it ease the margins situation which brokers and bankers are facing at this point? May be somewhat but even so I doubt whether this will have a hugely material impact on how things are progressing.

Is the market oversold? Are things getting overdone? For sure they are but that’s how typically things happen in bear markets. In bull markets too they were getting overdone, since November-December-January and now we are seeing the opposite end of it and that might well continue for a bit longer. So yes, short answer to this – the regulators are trying both globally and locally and they will do more to alleviate the pain but barring short-term bounces which might happen because of these measures in the medium-term we will still have to go through very rough times.

-Udayan Mukherjee, Managing Editor,CNBC TV18 ...

On Earnings:


Earnings is a different matter altogether. While GDP growth will fall, I think the pace at which earnings might fall could be even more dramatic than GDP growth, because there is lot of elements to GDP other than just pure corporate earnings or manufacturing sector. So you could probably see a lot more deterioration in the corporate earnings profile over the next few quarters if things continue like this. So at the micro level the damage might be far more.



Two months back the assumption was that we are not growing that fast any more, so last year we were thinking about 20% growth so sadly we will have to get resigned to 15% growth, but 15% is in the bag, do not question that. Now I have heard a couple of people talk about 10% growth. What if at the end of the next couple of quarters, we go back and say there is no growth or corporate earnings for a large number of companies is absolutely flat? Has the stock market price that in fully or a completely flat earnings growth profile?



You can imagine that a large number of sectors like real estate, autos and metals are probably going to show you negative growth. By the end of this year,many commodities, real estate, autos perhaps many other sectors, which are dependent on commodities, natural resources could all report negative growth. So what is so sacrosanct about the overall index earnings not becoming flat? In that case, you are talking about earnings recession as well. So then does 10-11 times look so cheap?



The only point one is making is this is not an environment where you need to be complacent about. Do not assume things for given that this economic growth, this earnings growth is in the bag and that is my metric with which I construct valuation and stock price levels. Things are not very fluid; they could turn out easily far worse which the stock market has tried to price in. I think a lot of pricing has happened.



The one thing is that yes things are bad but the stock market is also at 10,000 now. The stock market is no longer at 14,000, so a lot of it has been priced in maybe a bit more needs to be priced in and I am sure that the market will do it at its chosen pace.


-Udayan Mukherjee, Managing Editor,CNBC TV18 ...

To me the bigger worry is even if you somehow stretch through the next couple of months and arrive at more than 7% or even if it closer to 7.5% by the end of this fiscal, should we all be rejoicing or should we now start worrying about What lies ahead given the way and the pace at which things are worsening globally and locally?? What lies ahead after March 2009? What kind of numbers could we then be seeing? We have come out of four years of very heady stock markets and heady economic growth. Therefore the pace at which opinion tends to worsen is also a little sticky because we are spoiled with seeing extremely good numbers at the macroeconomic level and at a micro stock market and a corporate level. So people will always be slow adjusting their views downwards. People are people, whether it’s the Finance Minister or stock analyst or the head of the Prime Minister’s Economic Council; people are the same.



So in the stock market when you come out of a fantastic trajectory of earnings for 15-16 quarters then the downgrades always tends to be extremely slow and the stock market always leads, where stock prices fall first and the downgrades follow later. I think that exact sequence will follow this time as well and what we are leading up is that things worsening progressively from quarters and us landing into fairly bad soup in the FY10.



So the bigger question what should be asked economically is not whether we can get away with 7% growth this year but whether we are staring at sub-6% growth in FY10 and that is a data point and a fact then one should be prepared to ask and challenge squarely because we don’t want to be in a pretty scenario with denial saying, “we cannot mention 6% its absolute sacrilege.” That probably you are staring at next year.



What if we lend up in FY10 at a 5.7% or 5.8% growth? How would that sit after looking at 9.5% GDP growth in the matter of just about 18%. Would you then celebrate and take joy at the fact that you are still growing at 5.8% or 6% or would you say, “It was 9.5% and we have already got skittle down to sub-6%. That is a real threat and things have to improve materially on the ground for us to be not presented or faced with their reality in about 6-9 months from now. “

Q:Even about this year, are we being a trifle optimistic in expecting even 7%? The stock markets have discounted and will discount more but this is just an August number, that is another more than half the year left to go and it is 1%; the economist was talking about industrial recession so probably we are going to see contracting numbers. Even this 7% and whatever EPS growth we were looking for the Sensex it was shot of 1,000 after the corrections but should we scale that down considerably and therefore look at a very different GDP number, IIP number and Sensex EPS forecast for FY09 itself?



The stock market in its wisdom has been doing it. That is what is getting priced in, the way stock prices have been falling for the last few months, that is clearly the market’s apprehension. 7% is not in the bag, 13-15% earnings growth is not in the bag by a long stretch because when things start worsening, they worsen far more rapidly than one can ever envisage.

This is not to suggest that there is only gloom and doom on the horizon and we are harbingers and messengers of gloom and doom. This is exactly how things have played out in the past. The things go up for a while and then hang around for a few quarters before it starts decelerating due to the impetus of the past and as momentum takes a while to turn down quite so decisively. But now that the momentum on the way down probably has started and the worse the numbers look, the worse sentiment will get and that itself will unleash. It will become like a vicious cycle as we have seen in the past. So you maybe 7% is not in the bag, maybe we see sub-7% numbers in fiscal year 2009, which sets the platform for a much lower GDP growth and economic growth in 2010.

-Udayan Mukherjee, Managing Editor,CNBC TV18...

Markets are witnessing fresh bouts of selling and have plunged further on the back of weak IIP numbers. Benchmark indices are under extreme selling pressure, due to heavy sell off seen across the globe. Meanwhile, the news of RBI move to cut CRR by 150 bps with effect from tomorrow has given some cushion to markets and frontline indices have seen mild recovery from lows of the day.



Amid the `industrial recession` as named by the Prime-Minister economic advisory council member, Udayan said there is a pronounced slowdown which will only deepen with the passage of time given how things are unfolding globally. That’s what the stock market has been pricing in over the last few weeks. So it should come as no surprise, that the bad news is now coming out because that is exactly how it happens, stocks fall first, then bad news follows.

On `industrial recession`:



People have been in denial all along and this is typically how things work out. In previous cycles too, this is exactly the sequence things follow - first the stock markets fall, then the CEOs, economists and the government tell you that ‘nothing is wrong and things will be fine’ Not just the Prime Minister’s economic council, but recently you had the finance ministry you that we are still on target for 8% this year and 9% next year. That’s the level of denial that we see in this country. So far, not significant segments of the CEO population have come and told that things are bad. But this is not a number for the figment of somebody’s imagination, this is a data point, the kind of capital goods and manufacturing data point that you are witnessing today. Just juxtapose that with all the voices that you have been hearing every time an IIP number comes out. We have comments like ‘Everything is fine, our order books are healthy and there is no evident sign of a slowdown’, So obviously these signs are coming from some other planet because we are not facing any kind of slowdown at all, this is just a classic denial. Finally the CEOs will come around in the next couple of quarters, to tell you that things have changed and they changed while they were in denial mode, they didn’t change day before yesterday. So what we will follow right now is that the estimates of GDP growth will get crunched down further and the bigger problems will come for the next year which is FY10 when GDP and manufacturing growth assumptions will fall off quite significantly. But now when you do a lot of channel checks with companies on the ground, particularly many of those SMEs, a lot of stress is visible which we are not hearing directly out in the open or in the media -- which is companies freezing employment, laying off employees, raising bench sizes, resorting to production cuts and stalling purchases of capital goods in a significant way. All of this is symptomatic of the kind of slowdown which is unleashing. So as some people have been saying for the last few weeks that ‘our house is very much in order, India is a great story’, it might be a better story in a relative sense but that is not to say that India is in a very good economic and corporate situation at this point. Far from it, we heard the IBA chief telling that they are not lending in any major manner and all that they want to do is hold on to liquidity at this point and companies which bankers are hearing directly from them are beginning to cut down production. So there is a pronounced slowdown which will only deepen with the passage of time given how things are unfolding globally and that’s pretty much what the stock market in its wisdom has been pricing in over the last few weeks. So it should come as no surprise, that the bad news is now coming out because that is exactly how it happens, stocks fall first, the band news follows.



On GDP (Gross Domestic Product):



The industrial sector is not in shape and the point is that we are looking at current figures and that’s the dangerous bit, it’s pretty much like the Infosys example. This quarter numbers were great but the market is still hammering the stock down because it worries about the future. At this stage you are already looking at these kinds of 1%-1.5% IIP (Index of Industrial Production) numbers. Now the question is not whether in the next couple of quarters because the first half of the year was not too bad and which is already behind us, the average number turns out to be 7% and more. I do not think that should cause any jubilation.



-Udayan Mukherjee, Managing Editor,CNBC TV18...

On Nifty levels:

We closed at 3,500. Roughly 7.5-8% takes you to that 3,200 plus zone. We will see levels between 3,200 and 3,250 on the Nifty. But we should not go by all this because if anybody has asked us whether we would have foreseen the Dow at 8,500 so soon, then I don’t think any analyst there would have been said that you are going to see DOW at 8,500.

So we don’t know what level we will hold 3,200-3,400. We are in a free fall kind of situation. At some point though one doesn’t know where it will stop we will get a pull back but the further you are getting away from the 3,800 mark which held for many months, the chances are that now becomes a very roof over the markets head.

Maybe any technical pullback has that as a distant target. If we go to 3,000 in this fall and then to climb from 3,000-3,800 will require a 25% rally. So even if we have a spectacular bear market rally from lows of close to 3,000- a 25% then also you get capped at 3,800 Nifty. So that is now firmly what was the big support for the market, is the big ceiling over the markets head and that sort of changes things completely.

Where is the floor? - We don’t know. This morning we will probably start at 10,500-10,600 on the Sensex and so you are pretty much around 10,000 levels. Is it looking like the bottom is here?- Clearly the screen is not telling that the bottom is here, so don’t even get there. The best trade this whole year is not to be trying to find value in stocks etc. I think we will still be surprised by the kind of lows we will see. There is no point mentioning levels now. Last time we spoke we were saying around 10,000 one should buy this market but maybe now you revise your opinion and say at 10,000 you start buying but you don’t buy your house and put it in the market because it looks like events are overtaking. 10,000 is ten times and you are buying at historical floor levels in the market but those have no meaning.

So you say that, I don’t know if market is going to 8,500-9,000 which is a possibility in this cannot be ruled out but I don’t know whether it will get there. So as we said 10,000 is a good enough level, at point you start buying and if the market continuous to slide because of global panic then you buy it through 10,000 or 9,000 or wherever the market will finally stop. But at 10,000 if we get there over the next day or two purchases should commence and at least for the first time in 2008 – saying that you should go out and deploy cash. Because so far it’s never looked like a good time to go out and buy stocks from an Indian perspective. We will be surprised by the levels as we always are in bear markets.

-Udayan Mukherjee, Managing Editor,CNBC TV18...

We came to Bangalore this morning to talk about Infosys but that might just be relegated to a sideshow today. It’s Black Friday looming across global markets. No market has been spared, the US was down 7%, the Japanese market has frozen more than 10% down and most Asian markets are down between 7-8%. So it looks like we are going to start 7-8% as well this morning and no respite.



I don’t know what Infosys will say to even lift the pall of gloom a bit or to add to it but that’s a sideshow. Today it is all about global markets and be prepared to see a huge cut on opening bell whether we go circuit down or all the way 10% is a matter of debate but a 7-8% cut looks like a bit of a forgone conclusion this morning.

We have had difficult days through the week but today you can just smell the panic across screens?

Yes and the context of this panic, is important as well. We have had rate cuts across the world; just 48 hours back and after such concerted action from all global Central Banks, we are seeing almost circuit like situations in markets across the world. That is precisely the point that this situation globally has gone beyond any kind of band-aids, which Central Banks can do. If the situation was that of two-three months back then such a global concerted action on a bailout package would have lifted sentiment in a market but that is just not happening. Nothing that anybody does is helping the situation at all and markets are just falling like ninepins.

We are in a complete panic situation globally. The credit markets are just not opening up despite a lot of inducements from the regulators and I suspect we will have to fall in line with that as well. I think the problem is exacerbated by the kind of regulatory action. We have seen the short selling bans that distortion is coming home to roost now. So last night what happened in the US is because shorts were not allowed and when they were allowed, the gates were open they all pounced on the market. So not only did the post rate cut rally not pan out because there were no shorts to cover up and on the other hand it is actually working against the markets now that the gates open.

So it is partly regulatory distortion, which is coming home and partly the global frozen panic, which is playing out. So as I have said last time, bear market is in full flow, cannot stop it.

The thing about us is that even on Wednesday it wasn’t a meaningful pullback perhaps it was just a pause because we had a day off?

There is no pause in this market; the Dow is down some 22-23% in the last ten days that’s a complete collapse. The S&P after seeming like it will outperform all emerging markets this year in ten days has undone all the good work of 200. One must keep an eye on what’s happening on commodities, there is a freefall happening there. Currencies are in complete turmoil the yen is at 98 to the dollar, the dollar is going some other place, here closer home the rupee is at 48 who knows this morning it is going to more than 49.

So how many fronts will you watch now where currency has gone for a collapse, global currencies are putting pressure on you, there is a huge amount of selling pressure from global institutions which just cannot be soaked up here, local panic. There are just too many things which are volatile are in a state of flux right now.

This week that pullback rally never panned out perhaps because there were no shorts in the system. We can go on saying oversold for everyday because everyday the market falls more than 5% but heaven only knows when there will be a pullback in this market. It’s clearly a worse situation then we thought or anybody could have foreseen a few weeks back.

-Udayan Mukherjee, Managing Editor,CNBC TV18...

Will the government bite the bullet ----------------------------------- India is following US with a 6 month lag. Fortunately we don`t have the kind of credit crisis that US is facing now . Nevertheless, growth would be significantly impacted across sectors. GDP to go down to sub 5% levels. Profit hit for nearly all Nifty scrips, with some going into losses. However., we do have a liquidity crunch similar to the US, though not so bad. Unless the government acts fast, Indian credit markets risk a shutdown and the economy risks going into a recession/ near recession. US Government stayed on the sidelines for too long. The bailout and the rate cuts should have come around beginning of this year. Though we have very competent economist at the helm (and I have a great personal regards for them) , still the Indian government is also doing exactly the same thing as the US government did 6 months back - stay on the sidelines , take half hearted measures and provide optimistic sound bytes. Government to immediately do the following if we are to avoid a recession / near recession (significant slowdown is now certain) :- Immediate cut in CRR to 6% and to 4% in a months time. Will infuse liquidity. Also cut bank rates by 2% to 7% and SLR by 5% to 20% in a staggered fashion over 4 to 6 weeks. Unlimited protection of savings in banks for the next two years without limit. Will create confidence for account holders and avoid a run on banks Direct funding to commercial enterprises and banks by opening a lending window against collateral of securities. Can be routed through any one of government`s funding arms. Increase spending in Infrastructure. To boost incomes, GDP and keep economy in track Yes, inflation will increase, but a recession/ near recession will be staved of. Will the government bit the bullet with elections not so far away. US government did not do it 6 months back. Now with its back to the wall, election or no elections , it has just no choice....

Recalibration begins -------------------- As a consequence of the economic crisis, the economies of the world and India will start going through a recalibiration process. This is the very beginning of recalibration of Economy and markets (Indian as well as global). Things will get far worse and the process will be painful. People`s day to day life is going to be impacted; for some, very severely. However a time of great opportunity for the long term investor. A decade from now Indian economy will emerge far far more stronger. Stock Market outlook -------------------- - No change in my assessment. Given a 12K breach, there is now more than 70% chance of a 10K breach - On the upside , my estimates suggest that Sensex likely to go up to 40K (min 25K) by Sept 2013 and 80K (min 45K) by 2016 Investment Strategy ------------------- - Begin Accumulation. If you have Rs. 100 in free cash, invest Rs 50 right away. Remaining Rs. 50 post 10K breach. Monthly savings – hold off half for 10K breach and use the remaining for regular accumulation. - Existing holdings – Hold on to existing investments, unless you need cash urgently. Be ready for a long haul. - Be ready for a seven years kind of time span. Key Drivers : Global Economy ---------------------------- - US in recession : the question now is not if so, but, how bad will it be and will the country go into a depression. - Credit markets : in US and Europe have absolutely frozen out. Nobody is ready to lend to anybody. There is a deeps sense of mistrust. Banks, corporates and even government bodies are looking at severe cash crunch. If the liquidity situation does not improve in next month or so, US risks a complete economic shutdown, similar to the great depression of 1929. - US financial markets: At best there will be complete restructuring and at worst a complete meltdown. More big names will go down under - Europe / Japan : Europe and Japan already in recession like states. Japan Q2 GDP contracted 0.6% QoQ. Europe growth estimates for 2008 at 1.7% and falling. - China – in slowdown mode, similar to India. - Global impact of US and Eurozone meltdown/ recession : Economies across the globe would be impacted significantly though by differing degrees. Global slowdown certain, global recession likely. Key Drivers : Indian Economy ---------------------------- - GDP Growth : 5% or lower levels over next two years - Slowdown across all sectors. As is the case in all downturns , the hardest hit would be the cyclical and commodities sector. - IT/ BPO : Margins coming down. Outsourcing will become more difficult as US/ Eurpoe jobless claims mount. - Steel / Cement / Mining/ Refining /Commodities: Will be worst hit as the price cycle takes a downturn. - Banking : Will be badly hit. Credit offtake falling , margins getting squeezed and defaults rising. - Telecom / Pharma / Consumer goods : Not so badly hit. Though growth rates will come down with varying degrees. - Capital goods : Badly hit. Corporate will hold off capital goods investments. - Infrastructure : Growth will slowdown. Government will be short of cash to fund projects till the economy goes on a recovery path. - Auto / 2 Wheeler : 4 Wheeler will be badly impacted. 2 Wheelers less so. - Labor prices : Salaries, bonuses and increments would be adversely impacted. - Labor market : Layoffs will start in H1-09. - Land prices : Prices will come down. Distress sales likely by developers as even the big ones will run out of cash in 18 months. Some will go bankrupt. - Interest Rates : Will start coming down. In a couple of years we`ll again see housing interest rates at 6% levels..........

Customers see the liquidity,stock market participants concern about the profits.... there may be liquidity in the bank for its survival for few more months,or govt may help them out of way.... but investors worry is whether bank gives profits or not.... at this point,the management/rbi/fm not commented on their profits.... that is the reason for stock falling on daily basis.... the lquidity and profits are quite different terms.... Infy,one of the most respectable companies in inida has givien negative guidance for the coming quarter.... that cant be digested by the market.... if the sitution continues like this for some more time in the continents of US and Erope,the topline could be effected by nearly 30% which can give lot of preesures on the company`s business model....so,as far as infy is concerned worst has just begun.... pl note that there are no clear signs of reversal of recession in global economy soon.... Regarding markets behaviour,yes there may be a chance of some bounce as global leaders working hard towards the stabilisation of financial markets worldwide.... but continuous fii sellings,lack of domestic investors confidence,expected mutual funds redemption pressures etcetc may offset near term positives if any.... pl note that negative surprise is given by latest iip numbers.......

On ICICI Bank: The market has such conviction in hammering a stock down so continuously despite all sorts of clarifications coming in. Look at the sequence of events. The management has clarified not once, not twice, but thrice. The RBI has clarified; the Finance Ministry has clarified that ICICI Bank does not face any kind of problems, and yet the stock falls at the rate of 20-25% a day, which tells you that the market probably knows something that we do not. The market is a very clever beast. When clarifications are given and the market takes it on board, then there is no reason to fall like this. You can see that ICICI Bank probably does have a fairly reasonable liquidity position if not an utterly comfortable one. It doesn’t seem to be in any kind of problem that western banks seem to be in. Yet the stock price is falling. I doubt whether this is any kind of concerted bear hammering or anything like that. My fear is that the market knows something that we are not aware of today, which might unfold over a period of time. I hope that the market has got it wrong. For the moment, we take the management’s clarification at face value, and it doesn’t appear that ICICI Bank has any kind of liquidity problem or is about to go belly-up or anything like that – far from it. But the screen makes you worry quite a bit about how things are progressing. On Infosys: Infosys is a conservative company, and it always has been and will continue to be. Therefore it is no surprise that it has come out and said that it needs to lower its dollar revenue guidance and dollar profit guidance. It is important to understand why the market is focussed on the dollar revenue guidance because the market pretty much wants to know at this point what Infosys’ take on the business flow going forward is. It is not worried about reported numbers, whether because of the rupee versus the dollar or the dollar versus the euro, the reported numbers in rupees moves up or down. It wants to know whether core business for Infosys is going to slow down dramatically. Principally Infosys bills in dollars. Therefore the dollar revenue and the dollar profit guidance is what the market is taking as a proxy to what Infosys thinks about its business going forward and maybe justifiably so. That revenue guidance got cut down 5%, the profit guidance got cut down 5% from its peak, and that worried the market quite a bit. Infosys fell to Rs 1,050 in the morning and maybe it will not fall below Rs 1,000 because it gets valuation comfort, it goes into single-digit P/E multiple something that we have never seen in Infosys, and maybe it will not fall. So, the downside could be restricted to Rs 1,000. But upsides I suspect will be capped from here about Rs 1,300 odd because of the kind of murky visibility in dollar earnings that one is seeing, and what the management confirmed today. On markets this week and the week ahead: Enough damage has happened this week in four trading days to lose 15%, which is something that one doesn’t expect. I have been saying throughout this week that the market seems a bit overdone on the way down, and at least a technical pullback is likely and plausible. That has not come this week. That expectation has been belied. I hope it fructifies next week. So, I don’t know whether next week again if there is more global turmoil tonight, the Sensex and the Nifty fall further and maybe the Sensex falls to sub-10,000 levels, and from there maybe there is more regulatory action, and the market moves back. But essentially for the moment, it appears that between 3,000 and 3,800 Nifty, and between 9,000-9,500 on the Sensex on the way down, and I suppose 11,000-12,000 on the way up, the market is probably rangebound. There could be more downsides. But on a day-to-day basis it is very difficult to predict. For investors probably it is too late to sell. We are less than half of the index level of January. I think if you haven’t sold already you can hardly sell stocks that are down 80% from their peak values. So, it is tough to sell at these prices. Is it easy to buy? Not quite yet. So, I think investors should probably sit on cash, and not sell in a panic. They should probably not do anything and just watch the situation unfold over the next few days. -Udayan Mukherjee, Managing Editor,CNBC TV18...

The Media often gets away with many things because public memory is just short! This is one thing you can keep shorting nakedly and get away with it time and time again. After all there is a disclaimer for everything a Business channel does! So Udayan gets away with this First the stock markets go down, then economic indicators and then then the media changes tune to make news! Note conveniently Udayan sings ahead of CEOs CII the government and neatly turns the table donning the hat of an Economist in saying the whole system was in denial mode! Last quarter I wrote a critcal message on INFOSYS( which was being backed by Udayan terming the market as being unfair to its rupee guidance) My message was deleted! I assume it was because I called INFY a trojan horse! Now He concedes " The Market in its wisdom sensed it". Mind you he was down right shouting against it! He even got endorsements from the then reputed Indian arm of the Big five of wall street! Who is to question his integrity? or that of the channel! Who is he batting for? The Investor at Large after the ship has turned turtle! Did he not carry the Bluff? You can say how can he foresee!!! I will ask this How is he foreseeing now of gloom of quarters ahead? You can be assured that he knows the magnitude of the credit crisis ahead of any of us and the inevitability of the fall! More than Blaming him its the gullible viewers and channel managers who get away with it! one has to own responsibility for one`s mistakes The Media is the last person to be accountable in public!That`s the arbitrage of news and society! I do call Infosys a Trojan Horse! During good times they inflate the economy and heat it quickly and during hard times the lucky ones get to hide inside their Trojan dollar belly! I call this despite my full knowledge of the IT revolution brought about by their success and the turn of the Indian economy! This is because they are Just that an Offshore vessel anchored conveniently in Indian waters in good times and safely in International waters during a financial tsunami! That is their disconnect with the native economy! ...

This is not related to Udayan view or I am not here to oppose / support any view. This is my own view. So now those great American Trillion $ dollar paper company has fallen and CEO have disappeared with millions of $$$. No action against anyone and those greate culprit will open some other comany billions of dollars. How nice is their risk managment that they disappeared into thin air. This has not happened suddenly and same will repeat in India ASAP. With no road /water/electricity, builders are charging crores of rupees for flat. With no development , India is growing 8% annually. With falling American story , India growth story is going to fall like airplane crashing down without any control. It does not seems like there is no lower limit to this falling market and it proves again that market is only speculation in long or short term and only driven by FII. There is no difference between astrologer and market experts , who attach reason for anything. Now India should realise that her growth stands nowhere and we are helpless in our country.Not capable of handling any situation. ...

Udayan, The opening bell focussing NYSE NASDAQ is nice to watch for its informal and casual air. I wonder why our shows are so formal with women in coats sitting at a desk. Are there any PITS in NSE like they have in their exchanges? Why cant we see the inside of NSE/BSE or dalal street, why cant u be as casual as bob pissani and mithali as casual as the lady anchor in their shows.. Come on we have seen you on shows for almost 5 years now that even SAAS BAHU and SENSEX has a shot of you... lets get formal and get to see the busybodies in our exchanges. Make the shows a true reflection of what goes on inside the PITS of dalal street... not so english and formal please......