Domestic, global cues lowers market: Udayan

Udayan Mukherjee, managing editor, CNBC-TV18, says that the Indian market has been underperforming from last couple of days due to various reasons like politics, disappointment on Reserve Bank of India (RBI) policy, Bharti summons and sometimes global markets.

But net-net India has begun underperforming other markets. Below is the edited transcript of his interview. Q: We are seeing a complete crackdown, the lowest levels this year. Primarily based on what is happening across the global markets and the slide there?
A: Yesterday, the global markets did well even then, the Nifty fell by 50 points. The primary impulse might be coming in from global front; there is nervousness that after a stable couple of days global markets might begin to weaken again. India was in any way a weak case.
The Indian market has been underperforming from last couple of days due to various reasons like politics, disappointment on Reserve Bank of India (RBI) policy, Bharti scare and sometimes global markets. But net-net India has begun underperforming other markets.
I don't think too many markets today are trading at 2013 lows. It is even worse in dollar terms. Today, the primary impulse might be global but for some reason the market screen is looking extremely vulnerable.
Today's price action and the screen looks bad for people who were bullish. In last two days the market lost 150 points then it attempted a pullback rally in the morning of 30 points odd that failed.
The Nifty went down to 5,680 levels immediately then saw a slightly bigger rally or a pullback which took the Nifty to around 5,750. It again failed and the Nifty was down to 5,650. Repeated forays to attempt any pullback from what appears to be oversold ground that is being sold into repeatedly.
Today, the price action, the Nifty may not be down too much – 30-35 points but the way the 30-point fall has happened is far more disturbing than yesterday’s 50 point fall yesterday. It indicates that people are waiting for opportunities to go short at every rise and supplies waiting to come on any pullback which is very disconcerting. Q: Yesterday a technical analyst indicated that it will be very easy for India to decouple from the global markets now because of not just a whole host of fundamental factors that we have but also the technical levels that have been breached on the downside?
A: I think 5,660 which was the previous low have been taken out today. In last few minutes we traded quite a bit below.
That was the first level of minor support and that was taken out. I think there is a strong cluster in 5,500 area. There might be some level of support which might kick in around 5500.
By that time, the Nifty would have lost 500-600 points from that top of 6,100 and if one reaches there then there would be an enormous amount of damage to the broader market.
If the Nifty does lose another 100 points at the rate at which the midcaps and non index stocks are falling, then price destruction to the broader market would be quite immense.
From there, one could hang in with some temporary base but too much damage has happened in the broader market already for the market to get back to 6,000-6,100 levels easily. The market is becoming difficult. At best one can pray that the markets stops falling by another 100 points on the Nifty.