Clouds Of Uncertainty Loom

However in the absence of follow-up buying, the rally is getting tougher to sustain.

A hot topic of discussion these days is the so called foreign institutional buying not getting reflected in the figures to the extent expected. This is a reflection of the unnecessary prominence given by all and sundry FIIs activity on the

bourses rather than use one's own convictions and proceed on the basis of the same.

The Sterlite story

Sterlite officials believe that no great damage would be done to the company's financial health by the Department of Telecommunication issue.

Market participants thought otherwise and pressed the sell button on the first signs of bad times this morning. Fresh supply of three lakh shares are reported to have entered the system with the names of Savvy and Cowboy Fund doing the rounds. If Savvy has pressed the sell button then it would be a reflection of what happens when momentum enters a territory the least expected.

Broad action

The broad action reflects the tug -of-war between the bulls and the bears. This is creating a scenario wherein one section seems to be getting the upper hand during early action and then faltering to deceive. On the dealing front also buying and selling activity gives the indication of more or less equal momentum on both sides.

Bulls view

While the bulls paid greater heed to buy orders which were executed like the Taylor Fund's purchase of a lakh shares of HFCL, a lakh shares of ITC by Numero Uno and a couple of lakh shares in Satyam by Jordan, there was plenty of ammunition on the bear side also.

Bear facts

The bears on the street believe that they are getting the upperhand and cite the action on Zee and Infosys as prime examples of the same. Their argument seems to be that with no fresh money entering the system it is only a question of time before every rise is met with a fresh bout of selling.

To buttress their arguments they cite the selling carried out by institutions over the last couple of trading sessions.

Scud Fund pressed sales in telecom major MTNL as also in the industrial conglomerate with big plans for the convergence sector namely Reliance. Common Fund,

which is believed to have a long term interest in HDFC, too pressed the sell button and in the process offloaded four lakh shares of the housing finance major. And finally Peace Brokerage had a fair amount of selling to execute both in the HLL as also in Pentamedia.

The action counter

Zee Telefilms has emerged as the counter to watch with broking outfits led by the likes of Uncle Jam coming out with recommendations. This should be music to Golden Fund. Strangely however, Co -tech is maintaining a steady silence. Logic would demand that if you are bullish at the Rs 1000 mark , you ought to be doubly sure at these levels. But then

we live in a dynamic world in which ADR aspirations and the like have a vital role to play.

Outlook

The outlook for markets demands a high level of caution. While valuations may appear reasonable for those with an investment horizon, for traders the going getting tough. It is an atmosphere in which making a call is becoming tougher by the day.