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Market Outlook - Short Term
Tracked by: 0 Boarder
On July 8, 2004, India’s Finance Minister, P. Chidambaram, presented Finance Bill (Bill No. 22, 2004) in Parliament in which he proposed the introduction of the Securities Transaction Tax (STT) in the Indian financial markets. In the words of Mr. P Chidambaram, STT is a neat, efficient and easy-to-administer tax and it has the great advantage of virtually eliminating tax avoidance.
The STT is applicable at different rates on the value of the “taxable securities transaction” which again is defined to mean a transaction of purchase and sale of securities entered into in a recognized stock exchange in India on or after the date on which Chapter VII of the Finance (No 2) Bill, 2004 comes into force and is payable by the buyer and the seller of the securities.
The underlying logic of the securities transaction tax is to slow down the flow of speculative money, as it would be taxed each time a transaction takes place. Securities transaction tax (STT) is a regulatory mechanism in securities markets. The share prices may be manipulated in day trading market by the bulls, who push up, or bears, who push down the stock prices. Compared to several leading international financial markets, the sheer volume of speculative trading in the Indian markets is extremely high. The intra-day and day-to-day volatility of share prices is many more times in India than the much more organized markets like UK or US. The developed countries achieved development by facilitating the growth of small corporate enterprises, especially by enabling these companies to enlarge the equity base by unloading shares to the general public.
Despite a sharp increase in the daily turnover in the Indian financial markets, actual deliveries are less than 20 per cent of trading. Due to excessive speculation, much of trading in the Indian markets is concentrated in a handful of stocks. The top 10 stocks account for over 80 per cent of the turnover of the Indian financial markets. The top 100 stocks account for almost 99 per cent of the turnover. While there are several thousand stocks listed in the markets that are not traded at all. Over the years, we have witnessed that excessive speculative trading by big players more often than not degenerates into market manipulation. There is an entire history of frauds in the financial markets starting from the securities scam of 1992. The financial frauds recurring at regular intervals reveal that our financial markets are prone to abuse, manipulation and excessive speculation.
In the present budget STT has been hiked from 0.02% to 0.025%. I suggest that would have been good if STT is be hiked further to 0.15%.The increase in STT reduces market volatility by discouraging the intra-day trading activity of destabilizing short-term traders. There is great economic justification is hiking the STT from the current 0.025% to 0.15% so as to eliminate the bias towards the day traders’ vis-à-vis delivery based ones. The revenue potential of a 0.15 per cent of the STT provides another justification. On an average, the daily trading in the Indian stock markets is about Rs 100,000 million. By imposing a 0.15 per cent STT on this volume, the Indian tax authorities can collect Rs 150 million every day. As the Indian financial markets operate on an average 250 days a year, the STT could generate revenue of Rs 37,500 million every year. This is a substantial amount in the present times when the country is finding it difficult to raise revenues through taxation. An additional advantage of the STT hike is that it could discourage “hot money” flows, which are known for their volatile and destabilizing behavior. By cutting back financial resources in unproductive speculation, the STT could encourage long-term financial flows. The only argument against this hike is an increase may reduce significantly trading volume and hence the depth of the market. The resulting thin market may exhibit greater volatility.
But, the victims of volatile financial markets are often small investors; the proposed tax increase would help in providing some protection to the community of small investors. ...
Tracked by: 77 Boarders
Dear Suresh Mittal, I have my views that nifty will crash first to 4150 till 10.09.2008 and them move up. ...
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by :
hindlevernet
Hi TradeMore,
Nifty seems all set to touch its resistance
range of 4600-4650 within next 4-5 trading
sessions. From there, it is most likely to
crash badly. It will be sharp correction
indeed. First major support in this correction
may be about 4150.
At this time, 12 Noon, Nifty spot is at 4350
which offers wonderful buying opportunity, specially
for High Beta stocks like IFCI, RNRL, RELIANCE
CAPITAL, JP ASSOCIATES etc. But these positions must
be squared off as soon as Nifty rises above 4600 in
the coming days.
If you or anybody else wants to discuss the nuances
of the market movements, I will be on line from 8 PM.
Let us chat through yahoo messenger.
My ID is: mittalsecurities 
Tracked by: 77 Boarders
Mr bullsheet so do expect gold under 400 in couple of years..... ...
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : BullSheetRules
Dear jonas,
DOW going below 11080 will signify that short term weakness else SMART money will again start moving into DOW and other markets including indian market! :) :) Money made from oil, gold, silver etc will eventually move to equity market. :)
Gud luk & happy investing!
Tracked by: 0 Boarder
MKt may find new BOTTOM [1] Early central election[2] N pact impact on relation with U S [3] earnig season impact[4] IRAN _ AMERICA tense ...
In reply to:
Technology, metals, banks, real estate stks hammered
Posted by : MMB Messenger
It has been a struggle through the trading day today. It’s not been one of those days where we started badly and then recovered almost immediately; the first gap down and then the market has just been in that 300-450 points down range throughout the day on the Sensex.
Tracked by: 0 Boarder
MKt may find new BOTTOM [1] Early central election[2] N pact impact on relation with U S [3] earnig season impact[4] IRAN _ AMERICA tense ...
In reply to:
Technology, metals, banks, real estate stks hammered
Posted by : MMB Messenger
It has been a struggle through the trading day today. It’s not been one of those days where we started badly and then recovered almost immediately; the first gap down and then the market has just been in that 300-450 points down range throughout the day on the Sensex.
Tracked by: 0 Boarder
It has been a struggle through the trading day today. It’s not been one of those days where we started badly and then recovered almost immediately; the first gap down and then the market has just been in that 300-450 points down range throughout the day on the Sensex. ...
Tracked by: 77 Boarders
If all investors are abhimanyu\\`s then what is the use of chakra Vyooh. Only retailers are abhimanyu\\`s....
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : vam_aru
Stock markets like Chakra Vyooh ( Mahabharat ), and we ( all investors )are like Abhimanyu's , we know how to enter it, but we don't know how to come out of it......lol
Tracked by: 77 Boarders
Stock markets like Chakra Vyooh ( Mahabharat ), and we ( all investors )are like Abhimanyu's , we know how to enter it, but we don't know how to come out of it......lol...
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : radhika_nandlal
Could be coz the TRIN gave enough indications the past few days thats somethign was amiss.. next time i see a rally for 3 days in a row with an oversold TRIN for 3 days i will be very cautious... how come the markets demand fresh tution fees everytime... i think gurudakshina lapses on our part in previous births attract us towards this gambling den called stockmarkets...
Tracked by: 77 Boarders
Dear Raj,
quote
In the longer term though, Indian markets are likely to outperform.
unquote
this particular dialogue is bit overdone, every one on street says this statement. sick and tired of it..
point is be it short term medium term or long term, if one knows where to go long he/she will win in this mkt.
Unlike some idiots who were so adamant to give short calls at 3800, they go for quick money and shorting always gives quick money but it also ensures everything earned vanishes in 2 session (like the one we saw in UPA rally)
Positive mind with a plan will always benefit in mkt. Mkt from 3800 - 4500 is sheer outperformance
Take care...
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : raj_tibs
Dea pkk,
In the medium term, underperformance is more likely - given the high-beta nature of our markets. Also, barring crude tanking to sub-90 levels, there are not likely to be any immediate triggers for an upmove. The game was played well, and the market falls under its own weight, despite crude correcting so much.
In the longer term though, Indian markets are likely to outperform. Will wait patiently till the post elections crash to take any major long positions.
-r
Tracked by: 77 Boarders
Dear Bullsheetrules,
Bovespa almost kissed 50k today on oil weakness.
If Dow starts moving up towards 12k from Monday , we should have a good week ahead.
Negative outcome of NSG meeting may be easily discounted.
Hedge funds r Long USD at present, they will start pumping money into equities from oct onwards.
By the grace of GOD i could forsee, as early as May, the Big Boys going Short commodities n Long USD from july to sep period.
Regards....
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : BullSheetRules
Dear jonas,
DOW going below 11080 will signify that short term weakness else SMART money will again start moving into DOW and other markets including indian market! :) :) Money made from oil, gold, silver etc will eventually move to equity market. :)
Gud luk & happy investing!
Tracked by: 77 Boarders
Could be coz the TRIN gave enough indications the past few days thats somethign was amiss.. next time i see a rally for 3 days in a row with an oversold TRIN for 3 days i will be very cautious... how come the markets demand fresh tution fees everytime... i think gurudakshina lapses on our part in previous births attract us towards this gambling den called stockmarkets......
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : hindlevernet
Dear Rahika,
Technical Analysis, I think is ultimate tool
to see the levels of Resistance and Support. It
can be equally applied in short and long term.
Yesterday I was wondering that how Nifty will
behave today on 05 September. Inflation numbers
were acceptable. Nifty graph was indicating
strong rally. In the evening Dow collapsed. I
was not able to comprehend how Nifty should behave.
But even after following global cues, Technical
Analysis was stil in place. Nifty support of 4320
was not violated. It still did not fall below
peak of first minute wave of this present rally
that began on 28 August. Mastery of TA is the
mastery of the stockmarket.
I cannot help posting the names of great boarders
here:
RADHIKA
COLUMBUS
GURUPADA
KALIDAS
AMARAKBAR
I must have missed some names here for which I
apologise.
SURESH MITTAL
Tracked by: 77 Boarders
Lovemeall,
The TRIN did indicate something fisy.. when we had a 500 point rally that day it was oversold at 1.6, and was oversold all three days this week when we rallied or were resilient.. but then since we dint fall i thought i was reading too much into the bearish TRIN and on an impulse let go my PUTS for a song.... too bad....
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : lovemeall26
Yes radkhikaji,
After seeing nifty do a topsy turn inspite of the charts showing something else for the past two days, I too feel like throwing TA into the dustbin. Sheer madness going on these days worldwide.
After such a strong rally on tuesday, all TA was showing a higher trajectory, but nope, nifty had other plans. Seems , we will have to overlook TA for a few days and see the market sentiments which are taking more centrestage these days.
lovemeall26
Tracked by: 77 Boarders
I mean the points collected in contributing to this forum, once you collected 500 points you will be upgraded to platinum....
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : nightowl
WHAT 500 POINTS???? i8 not understand.......
Tracked by: 77 Boarders
Dea pkk,
In the medium term, underperformance is more likely - given the high-beta nature of our markets. Also, barring crude tanking to sub-90 levels, there are not likely to be any immediate triggers for an upmove. The game was played well, and the market falls under its own weight, despite crude correcting so much.
In the longer term though, Indian markets are likely to outperform. Will wait patiently till the post elections crash to take any major long positions.
-r...
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by :
pkk07
Seems like India is all set to NOT get the waiver at NSG. This effectively means that this govt. has to not just go out with a red face, its the end of political career of Mr. Manmohan Singh.
Worse than that, it shows India its place in world matters. However proud we may be of our resurgent nation, the world still thinks we are shit.
Wonder how would the stock markets react on Monday. Are we staring at another black Monday on back of more sell off in Europe and US and NSG failure?
Tracked by: 77 Boarders
0518
which typo????? i did not notice any... methinks my typos are becoming the joke of the board...lols
ritts...
In reply to:
WILL NIFTY HIT 3600 & SENSEX TOUCH 12000
Posted by : googol
0518
Yeah I know you would jump at the word and say 'look googol what do you say for this typo?'
M'am in all humility all I can say is that the typo was by design!
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