Macro Call….Sensex up past 19000 today….what next ?…..those keen to understand some more are welcome to attend my BSE Training Workshop in November 2010
Beginning January 2010,I had opined that our Sensex would trade in the range of 14000 to 18000 in the first half of 2010….This it did
Then as we began the second half of the year,I raised the range in July to 16000 to 20000
China and USA…Two Alerting Perspectives…. by each for each…Residential Housing Bubble in China & Country Rating Downgrade for USA…and where will our Sensex head in the second half of 2010 ?
Thursday, July 22nd, 2010
We have yet to cross half way through the second half and we see the Sensex past 19000 today…..so do I raise my range?….not yet
This is the beauty of Equity Markets…there are two diverse opinions at all times….This morning on the same stock channel,we see one ‘firang expert’ ,working for an Indian outfit, forecasting a 23000 Sensex by March 2011 on the back of higher corporate earnings next year,albeit with some intermittent correction possible….on the other hand we see another ‘Indian expert’ working for an overseas outfit sounding a ‘bubble’ caution at these levels
Here’s my view…..It’s one of Cautious Optimism for the Short Term…I would Like a Healthy Correction to levels of 16500….However this is simply refusing to come as FII Inflows dominate !
It’s all Green and Flowing In…..Clearly FII Flows have been responsible for this Sensex Buoyancy…In the first Nine Days of this Month FIIs have pumped in US $ 728 Million already…Year to date is US $ 13.7 Billion…Net Cumulative from 1992 till date is over US $ 86 Billion….These Inflows are pumping up the Sensex….and they are expected to continue as India remains a great Investment Destination for Years to come
Cautious Orange…..The Sensex is not exactly Cheap…it’s 18+ times FY 11 Earnings…..but then again it’s not exactly expensive too if one keeps a long term view in mind…certainly not a ‘Bubble’ as some experts opine
Remains Pink and healthy for India…..Cautiously Optimistic for the Short Term…more Optimistic for the Longer Term
Strategy Going Forward
Interesting ,but not altogether surprising,that in 2010 all strategies at all risk levels are making monies…Investment,Trading and even Speculation……Clearly India beckons…One should clearly remain Invested in Indian Equity for the Long Term…..reviewing,rebalancing,realigning and repositioning Equity Portfolios for the Long Term to capture Opportunities that will arise….looking for opportunities at lower prices if and when the Sensex falls significantly