Markets still uncertain about direction

Blog meant for 23 June 2017 Friday

Dear friends,

Nifty rallied well and was trading around 50-60 points higher until afternoon when it started to correct due to profit booking and weak global cues and finally closed flat. The global cues are flat too as European and US markets are mixed but flat.

As per 30 days moving average, Nifty is in Hold zone. However, it is nearing Wait to Sell zone.
The indications for short term for individual stocks are as follows:

THE HOLDS ARE – HDFC BANK, MARUTI, HDFC, DIVISLAB, Titan, ITC, Reliance, Asian Paint, ACC

Wait to Sell –ACC, M&M 

Buy – SBI

Wait to Buy – Axis Bank, YES Bank

Don’t Buy –  LUPIN, BHEL, ONGC, Infosys, TCS,  L&T

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Question of the Day

Question – Can I invest in GTPL Hathway ?

Answer – As mentioned in the Workshop, we do not suggest IPOs. Generally speaking 60-70% IPOs do not give good returns except on the first day. This is because most of the IPOs are being priced very ambitiously by promoters and bankers. The premiums charged by the companies in the IPOs  are very high in many cases and hence when the market realises how much the company is actually worth, then the price falls to reflect the true worth of the newly listed company.

Kindly do not ask for suggestions and whether to invest in a particular IPOs. Our general stand is to neglect IPOs.

If the company should not be missed during the IPOs, then we will explicitly state it in our blog.

If the company is really good, we can even later buy it for long term or short term. There is no hurry to invest in IPOs. In 1990s, the IPOs usually used to be priced at par value which is Rs.10 per share. Now, the face value of the shares are usually Rs.10, but the premiums charged by the company are running to huge numbers which results in most of the returns squeezed by the company itself and the investors may not receive much value.

It is just like a lemon seller squeezing out the juice from the lemon and then selling the lemon to you. The lemon with the juice is what you want to buy it for and not for the lemon peel.

All the best!

Dr.Bharath Chandra