Nifty overstretching?


Well-Known Member
Look at the world now:

- We have worries about new strain of virus that is far more dangerous than existing strains.

- Vaccine manufacturers have requested and obtained immunity from all sorts of liability. Which reflects the level of confidence they have on their vaccine!

- We have a global hack of that has compromised critical government and security infrastructure around the world - and even a week later, neither do we have a clue about the extent of the hack, nor has the hack been ended, nor do we know who is responsible for it.

One thing I know for sure - back in March when the first crash happened, I don’t think anyone expected that things would be this serious 9 months later. Most people thought it would be a few weeks or a few months maximum, and once it became warmer, everything would be fine! Now we are a week away from end of the year, and the situation is nowhere close to being fine!

Why exactly are we flirting with record highs? Will a US stimulus prop up Indian markets also?

It is beginning to look like we are positioning ourselves for a bad fall! The only question is, when!
Liquidity injected by US and other Central Bankers are mainly responsible for the current rally. Markets all over the world are going up .India is getting its share of foreign funds because it is very attractive destination for foreign fund managers and pension fund managers . They have no choice but to invest in emerging markets if they have to show 7-8 % return to their investors. China,Brazil are currently not preferred destinations so that leaves India as a country of choice. And who can fight against flow of liquidity ?

How long will the liquidity tap continue is not clear so till then party is on.....after that may be corporate fundamentals will improve and aid the rally. That is not to say we wont have any corrections...we will have them.

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