Global cues have not improved substantially. Crude oil prices have cooled down which will help the markets a bit. But, hopes are dashed with yesterday's fall. True colours of a bear market are showing themselves and there is not much good news coming.
We are witnessing a classic bear market unfolding. Weak bounces will be there in the market but those are just one-two days affairs. It is a vicious market.
Our markets:
Friday was a crippling day for the market as well and yesterday was one more of those. So any hopes that was abounding in the market that the Nifty could hold around 4,000 and attempt a weak rally has been completely dashed with the yesterday’s fall. I think the bulls are pretty much chopped out. Bears are getting more and more strength with every passing day.
We are absolutely bang in the middle of a vicious bear market and now the true colours of a bear market are really showing themselves. This is what it is all about- it will just keep dashing your hopes; the prices will keep seeking lower levels. You will not find too much good news and whenever there is a little bit of good news it will be ignored completely by the market.
This is a classic bear market that is unfolding in front of our eyes, so right now you should not have any doubt on what kind of a market framework we are in. From time to time you will get those weak bounces but all of us have now seen what these bounces are worth. Sometimes you get 700-point rally, sometimes you get 600-point rallies, but those are one or two day affairs. After that the market almost inevitably reassumes its inherent trend, which seems to be on the way down.
It is a vicious market out there, you will get those bounces from time to time but every passing day is reconfirming that we are squarely in the middle of a bear market and I think people know what that means.
Aisan Indices
Yesterday was a bad day for a lot of Asian markets; today it’s okay. China has fallen quite a bit but the rest of the markets are okay. Shanghai is down about 2.5%, Korea is down about 1%, Taiwan is down 1.25% - not great those markets another markets are down about 0.5%. They are down but we have seen worse over the last couple of days.
On global situation:
Global situation is sticky obviously because Dow is below 11,000. Just to look at the positive side because all the news flows has generally been bad. I think the fall in the global markets has been very rapid. I do not think even the worst or most pessimistic of forecasters would have seen the Dow at 10,900 so soon. That gives you a little bit of hope that maybe the fall has been so swift that some of these western markets could be setting themselves up for a little bit of a bounce. It could be a dead cat bounce but a bounce nevertheless because it?s been just a one way fall on the Dow. If we look at yesterday?s example, crude fell by USD 7-8/bbl intra-day when the US was trading and still you have got the Dow down 100 points. So it is ignored every bit of positive news which has been thrown its way, so there could be a technical bounce in some of the global markets particularly so if crude does cool off a bit more and that is hazardous forecast to make all of us know what happened last time crude went to USD 135-136/bbl. If crude cools down a bit more and the US markets sort of give you a dead cat bounce then those might be slightly better cues for us to lift us out of the complete depression that we are in.
On global situation:
Global situation is sticky obviously because Dow is below 11,000. Just to look at the positive side because all the news flows has generally been bad. I think the fall in the global markets has been very rapid. I do not think even the worst or most pessimistic of forecasters would have seen the Dow at 10,900 so soon. That gives you a little bit of hope that maybe the fall has been so swift that some of these western markets could be setting themselves up for a little bit of a bounce. It could be a dead cat bounce but a bounce nevertheless because it?s been just a one way fall on the Dow. If we look at yesterday?s example, crude fell by USD 7-8/bbl intra-day when the US was trading and still you have got the Dow down 100 points. So it is ignored every bit of positive news which has been thrown its way, so there could be a technical bounce in some of the global markets particularly so if crude does cool off a bit more and that is hazardous forecast to make all of us know what happened last time crude went to USD 135-136/bbl. If crude cools down a bit more and the US markets sort of give you a dead cat bounce then those might be slightly better cues for us to lift us out of the complete depression that we are in.
-Udayan Mukherjee, Executive Editor, TV18 |
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