Biggest test for nascent bull market

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With Green shades everything Looks . . . . . well . . . . . . . . . . . Green . . .


Anyway plz carry on

Happy

I still maintain today was an excellent day to buy. Just wait for a few days - you will see why.

Rate cut on October 4th looks almost guaranteed. Return of funds locked up in ICICI Pru IPO is guaranteed. Progress on GST looking great. Monsoons have been good, should kickstart rural consumption, and lower inflation in food prices.

Nothing really has changed - these are bull market corrections and consolidations. That's all.

On a forward basis, Nifty is just at 17 times earnings. Which is not something scary. Especially considering the reforms process has taken off big.

And I still maintain we are just days away from taking out the previous top.

 

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Yet another reason for market sentiment to improve. Last week, the money sucked out of markets for the ICICI Pru IPO will be coming back day after tomorrow.

And since this is ICICI Pru IPO, with significant special quotas for ICICI Shareholders in retail side, it stands to reason that many bids from ICICI Direct are also there. ICICI Direct and many other brokers, immediately block the entire amount of the bid in your account, based onASBA - that is Application Supported by Blocked Amount. Day after tomorrow, that Block will be released.

The same things that kept markets weak last week will be reversed day after tomorrow. That should have a positive impact on markets. I think we can safely consider that the total amount being reversed is of the order of Rs 10,000 crores at least because of the magnitude of the IPO!

I just realized the date was wrong - ASBA amount just got unblocked already. Funds are now available for buying!!

Thanks ICICI! and Thanks market for falling yesterday!

 

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Liquidity situation continues to be ugly - it looks like release of ICICI Pru funds will just be a very short term liquidity boost.

Telecom companies likely to suck out Rs 40,000 crores on Friday as EMD for the spectrum auctions for the weekend!

Plus Friday is the last day of declaring undeclared income - so banks are wary about demands for liquidity on Friday.

RBI should step in and announce some significant liquidity boosting measures to ease the situation on Oct 4th. This is probably the worst ever liquidity squeeze in the banking system in a long time.

Yesterday, markets crashed quite bad - and people would have expected Rupee to fall - but Rupee didn't fall much!