Crisis Of Confidence Over, But..

The crisis of confidence is slowly ebbing, but there is still no dominant sentiment.

Making a call on future movements has, therefore, become a tough call.

One of the views doing the rounds at the end of the week is that a brave madman is required to bring sanity into this market. With all major so called negative news already been factored in, there is a perception on the street that the worst may be over.

Generally when market participants are confused , it is a good time to bring an economist into the picture. The In-house Economist is of the view that the broad economy should continue to grow at 6-8 per cent.

Further there is nothing to indicate that the growth of the software service majors should see any dramatic downward drift. The momentum to the new economy would depend to a large extent on the telecommunications infrastructure being put in place.

Calling a brave mad man

With the great majority preferring to sit on the fence, the markets are in need of a brave man to provide momentum. The buy and sell orders driving the bourses appear in stutters, which does no good but to confuse further. A brave contrarian who is willing to take the bull by its horns is what this environment of turmoil would most definitely welcome.

ICE sees a semblance of recast

Though some new ICE stocks have been added to the MSCI index, the sector as a whole continued to be weighed down by the sell hammer.

A reflection of this trend was the fact that Business Standard's ICE Index continued to melt for the better part of this week.

There were some deals which give hope that this slide may be subsiding for the moment. Half a million Global Tele shares were picked up between the Y Car brokerage and Uncle Jam.

The SSI scrip, which earlier on in the month attracted a lot of attention caught the eye of Savvy as the week progressed. Convinced about the prospect of a healthy price run in this scrip, Savvy decided to pick up half a lakh shares.

Infosys tumbles

The bellwether Indian information technology scrip had a sharp fall yesterday. This tumble created further panic in a market which was slowly striving to find its feet.

Though the exact quantum of delivery based selling could not be confirmed, the quantities are not believed to be high. However the fact that a scrip which was hovering at the Rs 14,000 levels is meeting with selling pressure at Rs 6,500 levels , does unnerve a few. Among the deals speculated to have taken place is Uncle Sam's decision to sell Infosys.

Technical look

With fundamentals going for a toss in the intermediate phase, technicals are attracting a lot of attention of market participants. If wave theorists are to be believed, then a rebound is being talked about.

Since most tech stocks move in momentum, there is a justification in the belief that technicals have an important role to play here.

But considering the fact that there is no universally applicable valuation for most ICE stocks and the speed of change is quick , a look at the technical barometer could be a worthy exercise.

Tailpiece

As long as the markets were shooting through the roof, brokers were eager to land up in front of their trading terminals much before the markets opened. This picnic lasted for the better part of last year , as also the early days of this year. Now quite a few brokers have developed an aversion for their once loved trading terminals during the past few weeks. A reflection of this aversion is the long holidays several brokers and dealers are taking to more idyllic spots on the planet.