Market View

The End of Wall Street

Posted by : sambala

David Aufhauser, a onetime Treasury Department official and former general counsel for UBS?s investment bank, has settled with New York`s attorney general on allegations of insider trading in the auction-rate securities market.

A Nation on the Grill

Posted by : sambala

Bernanke: Crisis could prolong economic pain
By Jeannine Aversa, AP Economics Writer

Bernanke: US may be facing prolonged period of economic pain; door opens wider to rate cut

WASHINGTON (AP) -- Federal Reserve Chairman Ben Bernanke warned Tuesday that the financial crisis has not only darkened the country`s current economic performance but also could prolong the pain.

The Fed chief`s more gloomy assessment appeared to open the door wider to an interest rate cut on or before Oct. 28-29, the central bank`s next meeting, to brace the wobbly economy.

Bernanke said the Fed will "need to consider" whether its current stance of holding rates steady "remains appropriate" given the fallout from the worst financial crisis in decades.

If the Fed does lower its key rate from 2 percent it would mark an about-face. The Fed in June had halted an aggressive rate-cutting campaign to revive the economy out of fear those low rates would aggravate inflation. Since then, financial and economic conditions have deteriorated, while inflation pressures have calmed, giving the Fed more leeway to again cut rates.

Many believe the country is on the brink of, or already in, its first recession since 2001.

"The outlook for economic growth has worsened," Bernanke said in prepared remarks to the annual meeting here of the National Association for Business Economics.

All told, economic activity is likely to be "subdued" during the remainder of this year and into next year, Bernanke said. "The heightened financial turmoil that we have experienced of late may well lengthen the period of weak economic performance and further increase the risks to growth," he warned.

Consumers -- major shapers of economic activity -- have buckled under the weight of rising joblessness, shrinking paychecks, hard-to-get credit, declining net wealth and tanking home and stock values. All the strains are "now showing through more clearly to consumer spending," Bernanke said.

Meanwhile, worsening sales prospects and a heightened sense of uncertainty have begun to weigh more heavily on businesses, making them more cautious to hire and to invest in their companies, he said.

Employers cut jobs in September at the fastest pace in more than five years, the government reported last week. Payrolls were slashed by 159,000 last month alone. It was the ninth straight month of job losses. A staggering 760,000 jobs have disappeared so far this year.

The financial and credit crises, which took a turn for the worst in September and continue to stubbornly persist, are likely to "increase the restraint on economic activity in the period ahead," Bernanke said.

Even households with good credit histories are now facing difficulties obtaining mortgages or home equity lines of credit, he noted. Banks are also reducing credit card limits and denial rates on auto loan applications are rising, he said.

Banks, too, are feeling the strain of a lockup in lending, particularly in the market for commercial paper.

To that end, the Fed on Tuesday announced a radical plan to buy massive amounts of this short-term debt in an effort to break through a credit clog that is imperiling the economy.

"The expansion of Federal Reserve lending is helping financial firms cope with reduced access to their usual sources of funding," Bernanke explained.

Invoking Depression-era emergency powers, the Fed will begin buying commercial paper -- short-term funding that many companies rely on to pay their workers and buy supplies.

Cont.....

A Nation on the Grill

Posted by : sambala

Mr. Karabell is president of River Twice Research. His latest book, "Chimerica: How the United States and China Became One," will be published next year by Simon & Schuster.

WILL NIFTY HIT 3600 & SENSEX TOUCH 12000

Posted by : vkk43

Continuous fall in all cement companies share prices since last few days gave us enough indication that all is not well with these companies. They are losing their all support levels. Similarly, the fate of Laxmicotsyn may also fall in that category, if its present price fall is any indication. Otherwise also, all textile mills shares also equally down, though it was expected that depreciating rupee could help them but probably many of these companies might hv booked forex around 40/- for the current year with the result that they are not able to get the benefit of this depreciating rupee.
Infosys results should be good if not better as here I do not forsee any forex losses.

In one of your msg I read that you want senior boarders to speak good about market but market will move as it has to move irrespective of the msgs from all senior boarders. If bad days are ahead, they are and no amount of good msgs from any boarder could make them better. Just take the case of teledata. Last year nobody was prepared to accept the fact that this company was not worth investing. If u remember, I had posted a msg on or about 31st May 2007 when it was quoted around 65/-, that we should avoid making investment in this company as there were number of better companies available in the market. But I got in return a number of msgs asking me to substantiate my statement and therefore, I decided not to post any msg on teledata. Similarly, if we forsee that market weakness is likely to continue for a while, I think there is no harm that we accept this fact and we should not paint a rosy picture of the market, when actually we do not see that.
Thanks. I hv just given u my views as always. May be that I may differ with your views here.

WILL NIFTY HIT 3600 & SENSEX TOUCH 12000

Posted by : googol

0707

Dear vkk ji,

I am shocked to see the first result that has rolled out today that of Prism cement.Their NP has fallen 71% on a y-o-y basis and 77% on q-o-q basis.I think many cos would come out with such results only.No wonder cement stocks are falling like nine pins.I do not know what Infosys is going to offer on 10th!.I think Lakshmicotsyn also would fail in the results going by how its price has been butchered

Regards,

Difficult to predict market direction

Posted by : Udayan Mukherjee

The world keeps changing every night and we come back with a completely fresh perspective - so much has changed since the markets closed last evening or yesterday afternoon. The Participatory-note (P-note) regulations have changed; the Reserve Bank of India (RBI) has surprisingly cut cash reserve ratio (CRR), global markets continue to tumble though Asia is weathering it a little bit better this morning. So global turmoil, lots of policy changes - it will all go into the melting pot today, who knows what will win; policy action or global turmoil.

On global markets:
These are difficult times, unprecedented times in the global markets and therefore the kind of action that we are seeing is also quite unprecedented. Things are very fluid at this point in time. You do not know what the market will react to this morning, it could easily snap back because of the concerted regulatory action, which is happening or it could continue to drift down along with global markets. So it is a tough call.

We are seeing history unfold in front of our eyes. This is something that we do not see in a decade or a couple of decades, the kind of action that we are seeing in global markets and the way regulators across the world are forced to respond to it to at least keep the patient alive. There is absolutely history unfolding and therefore the less you take in terms of big directional calls in the market, the better because we have no clue of where the situation might land us in finally. It is tough times and absolutely historic times for financial markets around us.

For many markets, it is almost like the hemorrhaging right now?

It is and I suspect that will continue because this is not about small interest rate change and it is not about throwing a little bit money at the system or anything like that. We are probably hurtling towards the global recession not just the US recession at this point in time and the kind of economic distress, which might unfold over the next few quarters, is making everybody very nervous and justifiably so.

So right now you don’t want to get into that, okay inflation at 11.99 so we are fine, Cash reserve Ratio (CRR) down more 50-bps, so we are fine or to get extremely bearish between points and say now the market will go to 8,000 Sensex and the Dow will plunge to 5,000. None of us know what is going to happen. Could any of us have predicted the events that have unfolded in the last 4-5 weeks? The biggest analyst in the world couldn’t have seen of what is going to happen.

We are in unprecedented times and none of us know how things will shape up over the next few weeks and months. It is best to say I don’t understand what is going on; it’s beyond my comprehension completely. I don’t want to stick money into assets and all right now, if I could I would dig it under the ground and sit on it since I can’t do that I just need to be in cash at this point and not be brave trying to fool myself by thinking that I am the best analyst in the world who knows exactly how this thing will pan out. When in doubt just keep your money under the mattress that is always worked in history and that is going to work right now.

Asian Indices:

Asia is okay this morning it is not such a bad picture the Nikkei is down about 2%, Straits Times is actually up 1.5%, China is down 1.5%, so mixed bag but no great sell-off as you have seen across the US market things are little bit calmer out here though they started negatively, the most Asian markets seem to have come-off the morning’s lows.

It’s almost like a vortex situation everyday?

It is and the way things are now capitulating in the West is quite alarming because yesterday Europe was down 8-9% apiece. I do not remember in my memory when European markets fell 8-9% a day, Russia was down 19%. These are indices for large markets which are falling 18-19% a day; it’s not a single midcap stock. So it’s very scary, but the pace at which these markets are falling right now lead you to believe that for the near-term you are probably headed to another intermediate bottom because things do not fall 20% a day for very long. So its getting completely overdone right now, you are seeing the absolute peak of panic, it could last for a day or two sure or maybe in the next 48 hours you will probably see a spike back in the global markets. I know not the best morning to suggest that but it inevitably happens when market falls 7-8% a day.

-Udayan Mukherjee, Managing Editor,CNBC TV18

The End of Wall Street

Posted by : sambala

Dow drops 200 points, as enthusiasm about the Fed`s plan to loosen up credit fades.

The End of Wall Street

Posted by : sambala

NEW YORK, Oct 7 (Reuters) - U.S. stocks briefly turned negative on Tuesday, weighed down by financial shares, as disappointment about the absence of coordinated rate cuts by central banks tempered optimism about a Federal Reserve plan to strengthen the commercial paper market.

The Dow Jones industrial average .DJI was down 41.50 points, or 0.42 percent, at 9,914.00. The Standard & Poor`s 500 Index .SPX was down 4.81 points, or 0.46 percent, at 1,052.08. The Nasdaq Composite Index .IXIC was down 13.13 points, or 0.70 percent, at 1,849.83.

Investors had bet that after Monday`s slide in global equity markets, central banks might mount a coordinated response to calm jittery investors.

Bank of America fell more than 16 percent a day after it announced a plan to raise as much as $10 billion to shore up its capital. The bank also slashed its dividend and posted a slide in quarterly profit in a surprise announcement.

WILL NIFTY HIT 3600 & SENSEX TOUCH 12000

Posted by : BullSheetRules

Dear vam_aru,

That totally depend on those BIG PLAYers! Let us hope that FIIs do not go for MAD / Panic SELLing to generate that liquidity! Else we will that Capitulation behaviour coming from those FIIs! :) If those FIIs are ready to go for Capitulation behaviour, Let us use their Billion of DOllars to make Money for FREE! :) Index can be taken up lator on once their MAD SELLing is over! :)

Figure of 9800 on DOW corresponds to 3450 on Nifty!

So, let us hope for the best! Let us hope that those BIG PLAYers continue to PLAY the GAME Sensibly!

Gud luk & happy investing !:)

Will NIFTY Hit 3000 & SENSEX Touch 9800???

Posted by : Tarmac

HLN
This should be the new thread name instead of Will NIFTY Hit 3600 & Sensex Touch 12000.
Rgds
Tarmac

WILL NIFTY HIT 3600 & SENSEX TOUCH 12000

Posted by : vam_aru

Dear BSR,

Do you see NIFTY will take a support at 3400 ? DOW is rolling down again, so we might be falling again tomorrow,Even today from 3.6 % up we gone down to 2 % and closed flat...

WILL NIFTY HIT 3600 & SENSEX TOUCH 12000

Posted by : BullSheetRules

Another BS point: In the latest interview with RBI governer, it seems that those BS experts on CNBC tv were trying to put more pressure on RBI governor to reduce that INR ratio in the light of those FIIs SELLing! This way, those FIIs will make FREE money!

Now BS rumours through media are being spread that FM RBI or SEBI are not interested to save SENSEX from lower values for the benefits of investors!

Comeon.. if those FIIs will not stop their MAD SELLing, how can you expect SENSEX going into stable zone!

No wonder, those BS experts also got some kind of incentives! :)

Let us hope that DIRTY GAME through those BS experts do not get PLAYed. In the name of RETAIL investors, many ppl have tried to mislead! :) :)

Gud luk & happy investing! :)

WILL NIFTY HIT 3600 & SENSEX TOUCH 12000

Posted by : BullSheetRules

Yes fmcgbites,

With those kind of SELLing from FIIs, RBI is doing a good job on this regard by ensuring that INR go up against USD! :)

If FIIs would like to continue for SELLing like this, then you are right one can expect INR to go above 50. That is the only way to ensure that those FIIs do not just loot money from retail investors here!

In future, if some more FIIS or organsiation will come, then similar kind of appreciation will happen.

Gud luk & happy investing! :)

Capitulation!! Buying Opportunity Galore!!!

Posted by : Bull 2008

Dear udydudy

We have seen margin pressures in the markets, bankruptcy came next and many bank have gone burst in the US.
But still we are in a denial mode to sell stocks by the public in general and also seen less redemption pressures on mutual fund.
we are just seeing the distressed selling from the FII`s which is moving the index down.
But we not seen the mass exodus still by the public hence the capitulation has not been witnessed here in India still and has to take off and sooner the better.
Capitulation in india might be at the stage when we see 50%-60% sell off from top on the index.

Cheers