about 1 year ago
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Falling rupee

Rising crude prices

OPEC to curtail production

Uncertainty over Brexit

RBI policy

US Federal Reserve meet

Assembly elections

IIP, inflation and GDP

Mounting fiscal deficit

Corporate earnings

The all-time favourite – geopolitical tensions and weak global cues

Oh, the reasons are endless! At the mere click of the fingertips, one can come up with reasons for justifying a falling or rising stock market, right from thin air.

All the reasons cited above were valid even when the markets were going up over 300-400 points. But suddenly, today they are once again citied. Where were these reasons yesterday? he markets are so volatile, it has become a joke to actually look out for reasons as to why the market is falling or rising.

A reason cited today for the market falling will have no impact whatsoever tomorrow – easy peasy – the explanation, “ its already discounted for.”

A few weeks ago, the reason why the markets were falling was because the FIIs were selling big time. So when they buy the market should rise, right? Apparently not because despite FIIs buying stocks worth Rs.293 crore yesterday, the market is down today.

Take the case of PFC yesterday. Global rating agency, Standard and Poor's (S&P) downgraded the outlook on Power Finance Corporation (PFC) from "stable" to "negative" on the view that its risk-adjusted capital is the lower end of the threshold for a strong assessment. Yet the stock remained in the green and even today. One can justify now that the proposed merger with REC is giving it an edge. See, that’s what we mean…every reason can be twisted to one’s own convenience.

Most of the realty stocks up on Friday are down in the red today. All that reasoning of RBI easing norms did not hold for too long. Why are they down now? Overall market weakness and RBI meet scheduled for tomorrow.

So is today’s fall a correction or was yesterday a peak day? Now that is like asking whether all the lined up infra projects will find land, water and power? Somewhere at the bottom of your heart, based purely on fundamentals, it is apparent that this could neither be the end of the bear market nor could yesterday have been the bottom. Till China gets back on its feet, a few infra projects get off the ground, this volatility is there to stay. And we will be left looking for reasons, both for a rise as well as for a fall.

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