Why you should keep an eye on third week of Sept

Moneycontrol Bureau

The Stock Trader's Almanac says September is the worst performing month for stock markets. Not so for the NSE benchmark, which has defied the stereotype to touch record highs in September. So far, Foreign Institutional Investors (FIIs) have infused close to Rs 14,000 crore in September. If all goes as planned, more will come from the third week of September. Here's why:In 2009 September, Nifty jumped to 5000 levels from 22/9, and closed the month at a high of 5087.60  In 2010, despite closing in red for good 15 days against 6 green days, the index started trading at 6000 level from 21/9 and ended the month at 6029.  September 2011 witnessed a deviation during which a volatile Nifty recorded a high of 5169, which was lower than the low of September 2010 (5403.05). Even then, best returns came between 15/9 and 21/9 which conforms to the pattern being discussed. The acceleration was once again visible on September 21, 2012, when the index moved to 5700 level . However, it closed the month tad lower at 5629. Last year, that is in September 19, 2013, the NSE benchmark shifted gear to move into 6115 but sunk towards the close of the month.

However, one cannot say with certainty that third week phenomenon will play out in 2014 September as well. To paraphrase Pudd'nhead Wilson — September is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, October, April, November, May, March, June, December, August, and February.