Markets flat and looking weak

Blog meant for 14 June 2017 Wednesday

Dear friends,

Markets open positively today but finally closed marginally lower due to profit booking and also uncertainty regarding the upcoming Federal Reserve meeting in the US. The global cues tonight are that European markets closed mixed whereas US markets are trading positively as of now.

As per 30 days moving average, Nifty continues to show Hold signal, but the rise looks weak.
The indications for short term are as follows:

THE HOLDS ARE – HDFC BANK, MARUTI, ITC, M&M, HDFC, DIVISLAB, Titan, Asian Paint

Sell – Infosys, TCS

Don’t Buy –  LUPIN, BHEL, ONGC, SBI, Reliance, L&T, Axis Bank

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Question of the Day

Question – The moment we open a demat account, we get many phone calls, emails, SMS asking us to buy certain shares which are ‘supposed’ to give huge profits. Can we believe them or take action based on such tips.

Answer –

Nowadays, in the digital era, we are being bombarded by too much information from all sides. One of the examples of an SMS which we have received recently is –

“BUY ABC Enterprises BSE code – 456364 @ Rs.3.5, Stop loss 3.25, Target 8/15/25. Biggest manufacturer of garments in Assam.”

Such messages and emails are being sent bulk by people who are trying to artificially inflate the prices of small and unknown companies and they are trying to take the help of the general public.

New investors can be fooled or mislead by such information. Do not take any action on any such SMS, phone calls or emails. They are part of fraud or scams/illegal activities in the Stock Markets.

Buy / Sell only based on the analysis or study that you do about particular companies. Also, stick to bluechips as far as possible and do not buy small companies since anything can happen to such companies.

Many times we see that people get tempted by such SMS and buy that particular share and then they get stuck with those shares since nobody may buy them later. This happens and is possible only with tiny companies and not with index, bluechips companies which are traded in quantities of lakhs and crores everyday.

The moment you receive any unwanted phone calls, just cut the call or delete any such SMS so that it does not affect your investment decisions.

If you notice, these companies increase in price for a few days and decrease suddenly because some small group of investors are doing ‘share cornering’ with that particular company. Usually the general public like us get caught on the wrong side and end with huge losses if we take action on such information.

All the best!

Dr.Bharath Chandra