morning thoughts...

The markets saw the jittery effects of mercury transit and stayed volatile throughout the day , though the stocks mentioned by us outperformed the markets and remained as top gainers in a volatile market.

Once again technical and astrological analysis at its best , now we enter into the most important week of the democratic nation , markets are expected to be volatile and jittery with sudden rise and falls and will give mega opportunity to both long and short traders.

All economic indicators suggest that emerging markets, including India, are going through a rough patch. Then why is it that the Indian stock markets are setting record highs? Infact, for around nine days in a row, Indian stock markets had been rising until a correction today. One of the key factors driving the Indian stock markets is the hope that Indian economy will see better fortunes post elections. The investor optimism stems from hope that business friendly alliance will form a stable government which will speed up reforms and speed up economic growth. 

On the lower side good supports will be witnessed around 6500 levels whereas markets will face stiff resistance around 6800 levels.

Our pre intimation astrological transit of mercury will be at high and its effect will be witnessed clearly on equity and commodity markets.

An important question investors should consider here is: Will a new Government be able to bring in reforms quick enough to ensure economic recovery soon? We don't think so. What is crucial about policies is not just an announcement but timely implementation. And that's something that no party seems to have a good track record at. Whosoever gets elected next, will not just have the old mess to clear up but new economic challenges to deal with, for e.g., Food Security Bill. And these will just be the internal issues. External issues like Fed's policies and global macro economy are likely to make things more challenging. 

So one must not only rely on index levels and must be more focussed on individual stocks and try to be stock specific where gains will be huge , merely concentrating on index levels will lead to nowhere
At the ground level, nothing has changed to suggest a sustainable improvement in fundamentals of the Indian economy. It's true that certain macro economic indicators for India like exchange rate, current account deficit and inflation all are showing sign of easing.

However, this improvement is more driven by the restrictions on imports, external variables or factors beyond control. Any recovery in other emerging markets or developed markets is likely to be followed by an outflow of hot money from Indian stock markets. And this is likely to add pressure on rupee, making things worse for Indian economy. 

So will the rupee see more weakness against dollar is a concerning issue , commodity prices will be fluctuating but correct entry and timely exit will create major wealth.

Now if we go by the current valuations, Indian stock markets seem to be back in favour with the global invesors,  (MSCI) India index suggests that India is the most expensive markets among the emerging markets and BRIC Nations, with a price to earnings ratio of 18 times.

This compares to an average PE of 12 for emerging market economies, a premium of around 48%. Is this premium justified? Further, will it sustain? It is important to note here that current valuations for Sensex are only slightly above long term average.Hence, while the valuations might not look alarming now, we would rather be cautious as the economic recovery is far from sure footed , making current rally quite volatile. 
So whats in store for equity and commodity markets , currency …? We have yet again issued a report and intimated clients well ahead in advance and we are again assured that we will create magic again , same as we did in last elections.

We have shown many predictions in past – last being ranbaxy and wockhardt pharma.

So don’t miss any chance and opportunity and make most of it.

www.astroeyes.blogspot.in

Friday’s calls sent via sms and messenger

Gold Mcx – booked profits at 28247 – long from 28105

Silver Mcx – booked profits at 42970 – short from 43877

Crude Mcx – booked profits at 6079 – long from 6023

Copper Mcx – booked profits at 402 – short from 406

Nifty – booked profits at 6765 – long from 6581

Bank nifty – booked profits at 12755 – long from 12357

Fii Venus remedies – booked profits at 315 – long from 289

Gold Mine Ranbaxy – booked profits at 457 – long from 365

Ranbaxy 440 ca – buy at cmp 21 sl 18 targets 35 – booked profits at 37

Idfc – buy at cmp 129 sl 128 targets 132 – hit sl

Dlf – buy at cmp 175 sl 173 targets 182 – hit sl