The Crash( 17.5.2006) and FII activities since then

[pkjha30]

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

Hi Agilent

If you go back a few posts I have already posted month wise FII buy and sell activities in xls form and correlated it with Nifty down trend during those months

link is http://www.traderji.com/attachments...-since-then-fiidata1999-2006.xls?d=1149763017

Further NSe gives data for FII since 4th April 2006 so I have posted xls and chart correlating both dataFII and Nifty. As much as possible I am giving this as attachec file. Normally we don't go back to old posts. But I posted linkd for corrections that happened in 2004 and 2005 also.

Market movement is too complex to be explained by few of the variables. We knew about oversold and overbought, support and resistance, chart pattern etc. But I felt that being globally responding to events , setiments and policies we are much more affected by them. In fact I felt that though chart pattern reflects those things but we are not correlating with them in an obvious way. When suddenly chart and technicals break down we are caught off guard.

After going through data for last 7 years I have come to the conclusion that our market lacks depth and as happens in ocean, waves are more in numbers, higher in heights and faster than in deep sea as we approach shallow waters. So our market is vulenerable to external forces or what we call smart money in a more pronounced way. Money has moved out of equity market in USa but volatality is not as pronounced . This comarison is also presented in these posts.

Lastly we owuld like to identify if and when uptrend happens in what way dynamics of FII activities and global cues affected our recovery on the upside. I know fools only time market. But we are here not to time it but to identify the factors. If fact I would be more happy is somebody comments on the technical aspects alongside.


Perhaps you would like to read this article.
http://www.google.com/search?q=crash+and+FII+activities+&hl=en&lr=&start=10&sa=N
Pankaj

 

[pkjha30]

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

Hi Satya

It is primarily to understand. There is no call for investment.
I hope this serves some purpose.
Well as I said I am the night watchman .


thanks
pankaj

 

[pkjha30]

Hi

Dow(0.80%) and Nasdaq (0.23%)is in red. Looks like finally we are going to say goodbuy to our 9000 level and drift little lower.

Nikkei, seoul and taiwan has opened in green.

But Europe melted rightaway.

Sensex is exhibiting violent swings in both directions. So any upmove could signal more selling ,bringing it under severe pressure.

Now that global factors supporting positive sentiments are absent, such upmoves , if it comes at all , will be supported.

Indian companies , traditionally , follows the arguments that investors seek stock appreciation and are generally not concerned with dividends. So most of them declarea meagre dividend. If you see it will be around 0.5 to 1% of the cmp. They believe that shareholders will be fooled by bonus and splits which does not represent real gain. Therefore there is likelyhood of many companies to announce bonus splits etc. in order to bring in retail investors ,who normally believe in quantity ( check the obsession for penny stocks),

Therefore, such announcements will be in large numbers.

Global cues being negative , These may not help them much. Already AirDeccan has melted under the heat. Its disastrous listing will keep investors away from the primary market who flocked in for listing gains. In any case I was never in favour of IPOs for certain reasons. If a company is good , one can judge and buy even at higher price at a later date. IPO does not give much indication of performance.Allotment procedure is faulty. IPO procedure need serious reforms.

In fact the whole market need reforms. I remember when May 2004 meltdown happened, parket participants were protesting against Finance Minister. Now no voice is heard and rightly so, as they understood that market reacts to global phenomena anf FIIs activities more than any tax reforms or market reforms by the Govt. of the day. Ultimately these may be for betterment and to increase the depth of the market without which we will have violent mood swings of SENSEX.

There is no predicting which way sensex go.

We have to keep vigil and watch on FII + FROG and see if that serves the key to entry.

So Wait

Pankaj

PS: Agilent here is the excel file for FII and NIFTY since October 2005 Hope we get some more ideas from YOU

 

[Agilent]

Thanks PK

Need some time to analyse /comment

Rgds

 

[SGM]

Hello,

An Excellent Thread. Gr8 Job Pankaj.

I would like to share links from Money Control related to FII and MF activities listed in a tabular format. Data from 2000 till date is available.

Foreign Institutional Investors activity

Mutual Fund activity

Thanks & Regards
Sanjay

 

[pkjha30]

Hi All

nkp-Speak

Friends:

Screw all the various views and reasons for why this market is falling and whether this is a bull correction or a bear erection

The simple facts for the current pain, assuming you are all bulls with balls squashed hard:

1. The US has proved that it, and only it can run the world. Interest rate hikes in the US are the only reason why the world's markets are tanking. Rest everything is peripheral. Inflation is key and that too frigging US inflation.

2. I know psychological assualts have taken their toll, because today, for the first time, I heard someone say the Columbian stock market hads crashed 10% and was closed down on circuit. Unusual because we Indians are not even concerned of Karachi.

3. Today's fall of the Nikkei was fueled mainly because Bank of Japan's governor said that before he became governor, he had invested in a mutual fund run by Yoshiaki Murakami, who was last week arrested for insider trading.

Most of inflation depends on oil, and unlike in India where the price of oil is controlled, the US does not have such controls, and consumers get affected immediately by any increases.

Good news is that US inventories of oil is rising, a weak hurricane season is in offing, winter will be mild, Iran may compromise.

Oil appears to be falling! This may be good for the US economy, as the interest rates, used as a hedge for inflation, will not rise.

All eyes on Bernanke. This man will decide the world's markets for the next 6 months.

cheers,
nkpanjiyar

courtesy:R Seth

Well I will give you three laws of physics which will explain what I was trying to explain:-

1. Every object in a state of uniform motion tends to remain in that state of motion unless an external force is applied to it.

This simply means that slide will continue unless FIIs start pumping in money in a big way. When will that happen??


2. The relationship between an object's mass m, its acceleration a, and the applied force F is F = ma. Acceleration and force are vectors ; in this law the direction of the force vector is the same as the direction of the acceleration vector.

This means F (Force of FII applied) will be calculated on the basis of amount of Money they pump in(m) and average rate of climb of indices(a). The direction of force will determine the direction of "a"

3. For every action there is an equal and opposite reaction.

Market was running up as if there is no gravity. It has fallen hard. So there will be equally opposite reaction. The harder a ball ( ball is appropriate as it is full of air and World Cup is going on) falls the higher it bounces. sensex/nifty has fallen from higher highs and also harder. It is a prelude to higher bounce

Now that we have breached psychological block of 9000 , many of us would be etching to get back in.This is summer time perticularly bad for US. But In india we get watermalons quite cheap. This will certainly quench our thirst.

Bernanke will tell if we get FIIs money or not.

Till such time wait for watermelons to become available in plenty.


one question nkp: Do bears have balls???
Pankaj

 

[pkjha30]

Hello,

An Excellent Thread. Gr8 Job Pankaj.

I would like to share links from Money Control related to FII and MF activities listed in a tabular format. Data from 2000 till date is available.

Foreign Institutional Investors activity

Mutual Fund activity

Thanks & Regards
Sanjay

Hi sanjay

Thanks. Some of the data I collected ( historical from moneycontrol.com and now from SEBI and NSE as much as possible) were from the source you pointed out.


I hope we now give as much attention to FIIs as to other factors. FIIs have stepped up their activities since 2003 which coincides with the current bull run and also with seminal changes in the way India inc. thinks and works. We aspire for more global integration as against earlier approach of insularity.
We aspire for quality and efficiency as against attitude of "anything will do" and "slowly we will do it ".
Now Telecom scenario is an example. We have joined 100 mn club.In Infrastructure, we have seen four laning and eight laning, proper signboards, which we had never seen earlier.
Railway is also thinking of frieght corridors for goods movement.
Take any sector, you will find growth story.

The only hitch is that it has to reach large number of citizens, they have to be educated, employed gainfully, rest of india has to take benefits of advances in science and technology. In that India inc. has a great role to play.

But in stock market we are yet dependent on FIIs money.. That will come again. India is not yet deserted. Such swings are to force weaker players out of the market. the ball is going to bounce even higher.

You see sanjay, I believe in myself so I believe in My country and it is for us to develop it. Market will grow with it and not otherwise.

Pankaj

 

[srisara]

I have a thought in my mind.

FII's have made big money Selling HIGH (Any disupute?). So they are sitting on huge reserves right now that too with too good profits.

All stocks have almost lost 30-50% of their value. Even if U.S hikes interest rates, they people can still do business in India as they already made profits and can use them to fund the extra interest they have to pay.

Correct me if i am going wrong?

Satya

 

[shrinivas]

I have a thought in my mind.

FII's have made big money Selling HIGH (Any disupute?). So they are sitting on huge reserves right now that too with too good profits.

All stocks have almost lost 30-50% of their value. Even if U.S hikes interest rates, they people can still do business in India as they already made profits and can use them to fund the extra interest they have to pay.

Correct me if i am going wrong?

Satya

ya, you are right...and moreover, the returns here would be much more than there...I mean comparatively, our stock exchange has given much much more returns as compared to theirs.....
i'm not an expert.....I'm still not getting answers to many of my questions in this volatile market..

ganeshhity

 

[pkjha30]

ya, you are right...and moreover, the returns here would be much more than there...I mean comparatively, our stock exchange has given much much more returns as compared to theirs.....
i'm not an expert.....I'm still not getting answers to many of my questions in this volatile market..

ganeshhity

I think FIIs are already investing back in trickles. Remember they are net buyers for 2006 and only turned net seller in May 2006. Now they are buying for June 2006 except for first working day.They will invest the bulk when market is depressed as they risk market going up.
Once that is complete they would ramp up by buying in extreme quantity which will signal to lesser mortal that they are really back.

Just my hunch
pankaj