As a Concerning Week comes to a close,the Sensex again has chopped off a few hundred points and gone sub 25500
I’m Hoping for A Merciless Market ! ….that’s when you can get into serious wealth creation opportunities at lower risk for higher gain !
Have held from December 2014 that 2015 will be volatile and vulnerable and had repeatedly voiced cautions on SCRIP STANDPOINT Module on my company website
which would serve you well to visit and revisit to understand why we thought so
- Ominous Sensex ~ Play to Perish in the Short Term ~ 13-Jun-2015
- RBI cuts Repo by 0.25% ~ Sensex cuts 661 ! ~ 02-Jun-2015
- Sensex Slipping into 25000 to 27000 Range ~ 11-May-2015
This is the latest note emailed by me to clients and associates earlier this week
We have been quiet for a few months now for a good reason. Those who are on our fundamental wavelength know what we stand for. We had cut down drastically on our ‘Buy’ recommendations in all Modules in FY 16 till date.Too frequent communications then would have served little purpose other than the danger of generating ‘Noise’ from the exchanges !
A Communication is Now Due as to why on Indian Equities we had preferred to take the risk on Erring on the Side of Caution
Sensex closed down 2.23% or 587 points down today to close sub 25700 triggered by declaration of Shortfall in Rain & lower that expected GDP for the last quarter
While we are not into Equity Fundamental Advisory for Bragging Rights we must raise this issue to revalidate our cautious view held in 2015
We have held a view of Sensex Range of 25000 to 27000 for most part of this year 2015,especially after it touched 30000 on March 4,2015 after closing 2014 at 27500 levels.
We had opined in December 2014 itself and in January 2015 that the Sensex will record an all time high of 30000 early in 2015 as the three legs of the Equity Table ~Momentum,Sentiment and Liquidity ~ were all in favour although the fourth leg Valuation was beginning to raise an alert on the Corporate Earnings Front
Early in 2015 we were unable to assess with the required degree of conviction on four domestic factors and three overseas factors that would play out in 2015.Of course everyone had a strong view or opinion on these !…these were :
Significant Rate Cuts demanded by the Corporate Sector to revive Manufacturing Sector ~ Yet awaited
Corporate Earnings in FY 16 after a bad Q 4 FY 15 ~ Q1 & Q 2 FY 16 seem to carry forward from Q 4 FY 15 ~ Sensex FY 16 EPS projections lowering inevitable
Normal Monsoon ~ After a promising June,it’s been downhill in July and August 2015 and Monsoon Shortfall is now a given
Pace of Economic Reforms especially on the GST ,Land and Make in India Initiatives ~ Not much Headway given the Political Opposition that has disrupted and washed out whole Parliament Sessions
Was the record surge of Chinese Stocks backed by fundamentals
Will Greece be bailed out or allowed to default and exit the Eurozone
When will the US Fed raise rate
What we did assess with conviction was that FPI Inflows will ebb or even reverse in 2015 from the record inflows in 2014…another reason that should mute markets…as this was played out it was ignored by a frenzied midcap space market that justified it being balanced out by increased retail participation and absorption by increased Mutual Funds Investments