The Crash( 17.5.2006) and FII activities since then

[pkjha30]

Have a heart Pankaj ... PE levels of 7-10 should correspond with Sensex around 3000-4000 (quick guess).
AGILENT

Hi Agilent
Well Current PE is 15-18 for nifty and sensex. My guess is that 10 would be around 8600. May be wrong. Statistics was never my strong point.

Is it pessimistic for those who are waiting in the sidelines to invest. I assume that mostly people would have got out by now except for long term investing. Say , if they invested arount 2004 June They would be still inprofit. The danger is that they will also come for selling to protect their profit.

So as for investment a reasonable PE of 11 and fantastic PE of 7 is something to be desired. FIIs would not like that because their current investments would leave them a lot to be answered to their investors..

We need that confirmation to get in. So that was an optimistic statement. If we had no hope for the market many perople would not have cited mouthwatering valuations for many of the front line companies.

In fact, now the idea is to get as much as possible on a long term basis out of this downturn. Surely it is not going to last that long as many would have wished.

Pankaj

 

[pkjha30]

Hi

Its the same old story. Told time and again.

I was comparing FII deatils(net Buy/sell) and nifty closing and was struck how both are reflecting each other's movement. Yesterday a chart was shown indicating movement os FII-MF
I am attaching the chart for FII-Nifty movement.FIIs were quitely exiting when Nift was charting higher course. What is surprising is that from 4th April FIIs were selling but on 27th Apr They were net buyer for Rs. 2635 crs and by 10May Nifty closed at 3754. On 10th FIIs sold Rs. 44 crs. and selling started in right earnest. whcih peaked from 19th to 25th may. Total sell was somewhere rs.14,000 crs and net sell was rs.7709 crs.

From First June onwards they are net buyer for Rs.1187 crs.

Pankaj

 

[pkjha30]

Hi

Just about 4-5 weeks ago we were celebrating the fact for senesx surpassing DOWJONES .

^Dj 52 wk low-high range is 10,098.20 - 11,709.10 ( mid point 10903)

Currently in the range of 10,790.26 - 10,927.12


SENSEX 52 wk low-high is 6,757.04 - 12,671.10 ( Mid point 9714)

Currently in the range of 9,022.15 - 9,360.06

If ^Dj hits 52 wk low so will sensex. What members say.

So Just wait and watch. Stock markets are not for thrills or adventures(though it provides the same in ample measures) nor time it nor identify the bottom. That message has emerged from various members. Fundamentals will also be hit is growth rate really slows down world wide. But India has a long distance to cover in reaching those heights. So unless we have bad monsoon(afterall we are still dependent on weather god) for two-three years,something like enron and worldcom or internal or external disturbance we should be firmly on growth path.

Weakness will continue as every downturn will bring fresh supply of stocks. On the other hand every rally will bring those who are stuck at higher levels.

Saint has remarked in his thread that what is support becomes resistence and vice versa. I understand that it is because of supply/demand at those levels

How to identify the opportunity to buy is the main question . Let us wait for positive sentiments to emerge, with upmoves, FIIs into buying heavily and Global cues with FROGs croacking. That is the key to start investing. Till such time I would advise to wait. Further to end on positive note, unless we close below 52 wk we are in long term uptrend come what may. India is not emerging market but Indian Market. we will grow in our own right. We are still nowhere near 2004 bottom.

Pankaj

 

[vinsu]

Dear Pankaj .
Sorry to post in your ,but an update since i read your thread regularly .

Stocks: Nikkei Plummets With Biggest Loss Since 9/11 Terror Attack. It is down by 614 .

 

[vince]

The nikkei is down by 4.1% and our sensex has beaten it hands down so far, it down 4.6%. Seems to be saying if you can fall, I can fall harder. A " Hum Kisse se Kum Nahi " act ????

 

[xtiger]

The nikkei is down by 4.1% and our sensex has beaten it hands down so far, it down 4.6%. Seems to be saying if you can fall I can fall harder. A " Hum Kisse se Kum Nahi " act ????

Also "Kisme mein kitna hai dum..."

 

[pkjha30]

Dear Pankaj .
Sorry to post in your ,but an update since i read your thread regularly .

Stocks: Nikkei Plummets With Biggest Loss Since 9/11 Terror Attack. It is down by 614 .

Hi vinsu
Well I want rest of them also to post here. No sorry or anything. ok

Here are three charts from Yahoo sites
for DOW,Nikkei and BSESensex
In 5years from 10000 they went up to 40000 (1985 to 1990)
Guess what Nomura guys were in deep trouble since 1990
Dow and SENSEX are in long term bullish curve. At least that is what I think.

Pankaj

 

[pkjha30]

Hi

Let us see what our friends were doing today

Here's NSE data

FII trading activity on NSE and BSE in the Capital Market segment(In Rs. Crores)
Date-- Buy Value --Sell Value --Net Value
13-Jun-2006--- 1685.33--- 1856.47--- -171.14

Ans SEBI says
Reporting Date---Gross Purchases(Rs Crores)--- Gross Sales(Rs Crores)--- Net Investment (Rs Crores)--- Net Investment US($) million at month exchange rate
13-JUN-2006---- 1525.50--- 1427.60--- 97.90 ----21.60
Total for June--- 18312.90--- 17381.20 ---931.60--- 206.00
Total for 2006 --- 234225.30--- 222171.60--- 12053.80--- 2700.80
Grand Total till June 13, 2006--- 1088042.30 ---900546.40--- 187496.00---- 43801.30


And Mutual Funds( data is for yesterday)


Equity (Rs in crores)

Transaction Date---- Gross Purchases ---Gross Sales ---Net Purchases / Sales



12.06.06---256.38----266.58---- -10.20
Total(for June2006) --2794.63---4215.64--- -1421.01
Total (April - June '06)---33892.53---24299.62---9592.91


The whole logic is defying. It is shown in the charts posted on FII-Nifty that both move in tendem based on daily sale and purchases.

But they are net investors. For this month as well as this year. Of total investment by FIIs their withdrawal has still not crossed 4%. When Nse says they are net seller SEBI says they are net buyers. So off market transactions which do not get reported to exhcanges are taking place.

Ravi has remarked in his thread that FIIs buy is an arbitrage play. I hope he could elaborate on this matter.


The current downtrend is a global phenomena therefore all positive news will be discounted. In a way it will be good thatone can invest at lower level. But I would rather follow saint's Idea to buy into pullbacks when uptrend is confirmed.

Three charts given above shows clearly what is a bear market(Nikkei) and what is not( dj and Sensex ) The current dip doesn't even show properly on the chart. On the other hand Nikkei drop was precipitous. The only thing I am pointinh out is that as long as long term trend is intact there is no going back to bear market. That is yet to be tested. As nothing could be ruled out at this level there should be no fresh commitment. What ,we think , is attractive will be more attractive at lower levels.While going back to market let us take valuations in mind.

Pankaj

 

[srisara]

Pankaj,

great going my friend. With lots of patience, you are compiling the data and hope everyone is making use of it atleast in terms of understanding.

Keep going...................
Satya

 

[Agilent]

Pankaj
your initiative on FII stats is laudable.

Can I suggest ... if u have by now enough stats (say weekly figs , over the last 6 mths) it may be a good idea to put that into an excel sheet ... Idea being to convert that into a chart and thereby enable a better analysis of how the FII action is really moving the markets. ( let me volunteer to do this presentation for u , if u can give me the figures)

Analysing daily stats in isolation can get cumbersome .. you will agree
... and does not easily convey the big picture.

Thanks for yr efforts anyway

AGILENT