Pain at every gain
Pain is inevitable. Suffering is optional.
The word gain seems to be getting fast replaced by pain on the bourses. A little gain and there appears a flock which is ready to offload. Looks like the bulls have decided to pack their bags for a summer fiesta in the Caribbean for the cricket world cup. After a positive start, the rally in the Indian market simply fizzles out by the end of the day. This, despite a firm closing in the other regional markets. The local bulls just don't have the nerve to stay put or rather take a call amid continuing uncertainty over the near-term direction of the market.
No amount of good news is enough these days, given the weak undercurrent. On the other hand, players are losing no time in pressing the sell (or panic) button whenever any bad news hits the market. That too without proper examining the real impact of the bad news if any. So nervous are the bulls that they are refusing to buy quality stocks at relatively attractive valuations. Not too long ago, players were willing to pay a high premium for such shares.
In short, the market still looks fragile, and there may be some more pain left to be endured before a fresh move upwards kicks in. Today, we expect a cautious to lower opening on the back of a fall in most Asian markets this morning. The trend will remain choppy and lackluster in the absence of any firm buying support at lower levels. Stay light and take a fresh call next week.
Shares of Page Industries and Raj Television will get listed today. Given the mood of the market, the recent trend, and their steep pricing, the stocks are most likely to go down.
US stocks managed marginal gains on Thursday. Blue-chip indices rose for the fifth time in six sessions as merger news and strength in the financial sector overshadowed concerns about subprime mortgages.
The main indices climbed for the second consecutive day on Bear Stearns' strong earnings and the acquisition of a mortgage company by General Electric and Blackstone.
Citigroup, JPMorgan and Alcoa led gains in the Dow Jones Industrial Average and the Standard & Poor's 500 Index. Dow Chemical posted its biggest advance since July 2003 amid reports in an Indian financial daily that it will merge some assets with Reliance Industries.
The S&P 500 gained 5.11, or 0.4%, to 1392.28. The Dow added 26.28, or 0.2%, to 12,159.68. The Nasdaq Composite Index climbed 6.96, or 0.3%, to 2378.70.
US stocks zigzagged early after the PPI showed a surprising jump. The report fueled concern ahead of next week's Fed policy meeting. But the CPI, a key inflation number more closely watched by the central bank, is due on Friday. The Fed is widely expected to hold rates steady at next week's meeting.
Also weighing on stocks were remarks by former Fed Chairman Alan Greenspan that the problems with subprime mortgages could spill over to other sectors.
US light crude oil for April delivery fell 61 cents to $57.55 a barrel on the New York Mercantile Exchange. The contract was down 36 cents at $57.19 a barrel in extended trading in Asia. Crude prices have fallen from over $62, or 7%, in the last five sessions.
Treasury prices were little changed, with the yield on the 10-year note holding at about 4.53%, similar to its rate late on Wednesday. In currency trading, the dollar gained versus the yen and fell versus the euro.
European stocks surged. The pan-European Dow Jones Stoxx 600 index climbed 2% to 359.03. The German DAX 30 added 2.1% to 6,585.47, the French CAC 40 rose 1.8% to 5,389.85 and the UK's FTSE 100 climbed 2.2% to 6,133.20.
Asian stocks fell this morning, set for the third straight weekly loss. Toyota and Samsung Electronics dropped after US reports indicated slower economic growth and higher inflation in the region's largest export market.
The Morgan Stanley Capital International Asia-Pacific Index lost 0.5% to 141.00 at 10:34 a.m. in Tokyo. The gauge was poised for a 1.1% weekly loss. Japan's Nikkei 225 Stock Average dropped 1% to 16,696.77. Benchmarks also fell in Australia, New Zealand, South Korea and Singapore.
In emerging markets, the Bovespa in Brazil was flat at 43,278 while the IPC index in Mexico