Go for companies with strong cash flows & balance sheets
One thing has been proven beyond doubt this week -- more than fundamentals and technicals, markets are increasingly being driven by risk on and risk off.
ASHWANI GUJRAL Fund Manager, ashwanigujral.com
Nifty, the NSE 50-stock benchmark, continued its rally, gaining about 2.76%. The Bank Nifty gained over 4.97% in a maniac market which lashed on both sides amid two key events of the week. Nifty continues to be in the 5500-6100 zone -- with overshoots of a couple of hundred points in both directions.
Partial profits should be booked on long positions and the rest should carried with a closing stop of 5984. One thing has been proven beyond doubt this week -- more than fundamentals and technicals, markets are increasingly being driven by risk on and risk off. Just for the record, in August, the Nifty went down 20%, in September, it came up almost 20%.
The first event was the Fed policy which decided to defer tapering of the bond-buying programme for now, given weak economic conditions, which sent the markets up like a rocket. The second event was the RBI raising repo rates and reiterating that its top priority was tackling inflation.
Also, Syria retreated into the background giving added relief. The events of last week have given the government of India, a three-month window to fix the current account and fiscal deficits.
On micros, the spurt in the markets have lead to exaggerated moves, as liquidity has come back into emerging markets. On individual stocks, it is useful to move into the broader market as larger stocks have gained a lot in the past three weeks.
Overall, investors should get into companies with strong cash flows and balance sheets. Key weekly levels for Nifty, Bank Nifty and CNXIT are 5984, 10693 and 8120, respectively.
Nifty, the NSE 50-stock benchmark, continued its rally, gaining about 2.76%. The Bank Nifty gained over 4.97% in a maniac market which lashed on both sides amid two key events of the week. Nifty continues to be in the 5500-6100 zone -- with overshoots of a couple of hundred points in both directions.
Partial profits should be booked on long positions and the rest should carried with a closing stop of 5984. One thing has been proven beyond doubt this week -- more than fundamentals and technicals, markets are increasingly being driven by risk on and risk off. Just for the record, in August, the Nifty went down 20%, in September, it came up almost 20%.
The first event was the Fed policy which decided to defer tapering of the bond-buying programme for now, given weak economic conditions, which sent the markets up like a rocket. The second event was the RBI raising repo rates and reiterating that its top priority was tackling inflation.
Also, Syria retreated into the background giving added relief. The events of last week have given the government of India, a three-month window to fix the current account and fiscal deficits.
On micros, the spurt in the markets have lead to exaggerated moves, as liquidity has come back into emerging markets. On individual stocks, it is useful to move into the broader market as larger stocks have gained a lot in the past three weeks.
ADVERTISEMENT
Overall, investors should get into companies with strong cash flows and balance sheets. Key weekly levels for Nifty, Bank Nifty and CNXIT are 5984, 10693 and 8120, respectively.
 |
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
ADVERTISEMENT
