Hurtling Towards A Bottomless Pit
Can it get any worse? Where's the bottom? And, most importantly, when does one start bottom-fishing? These are some of the question uppermost on every investor's mind today.
Every passing day adds a new element of fear which gets aptly reflected in the Sensex score. However, every crisis is an opportunity in disguise in the market place, and this should bring a glimmer of hope and confidence back among the investors.
What is frightening is that foreign funds are desperate to sell even at these low levels. For instance, foreign funds remained net sellers to the tune of Rs 51 crore yesterday. It is learnt that two Singapore-based funds have pressed heavy sales at various counters. In fact, market intelligence has it that one of this fund is willing to sell the Bajaj Auto stock at a discount of Rs 80 to its acquisition cost.
These Singapore-based funds have a corpus of over $ 200 million which mainly comprises of pension money. Thus, with the equities looking shaky the world over, these funds seem to have decided to be on the safer side. These funds together have sold close to 60,000 shares of HLL on Tuesday which saw the price crashing. However, in the absence of much delivery-based selling, the stock remained steady yesterday. One of these funds is also reported to have sold close to four lakh shares of ICICI, and the same fund sold over 40,0000 shares of HPCL.
The market is expected to open weak today but a recovery is imminent during the course of day's trading. Fund managers insist that despite the falling Sensex, things are not bad for certain sectors. Thus, one still see foreign fund managers and domestic fund managers scouting for these value stocks.
Yesterday, two leading US-based funds are reported to have punched in a huge sell order of over six lakh shares at the Gujarat Ambuja counter. The order could not be fully executed but the stock came down crashing at both the bourses yesterday. The stock touched a new 52-week low on both the NSE and the BSE.
The HCL Infotech counter witnessed a trade of over 1.2 lakh shares on Tuesday. The Reliance stock has come under severe selling pressure since the past two days. The stock touched an all-time low of Rs 124 on the BSE yesterday. It is learnt that one of the leading Hong Kong broking houses dumped over 4 lakh shares on Tuesday.
While some of the operators have become selective buyers at the bourses, one of them has turned extremely bearish and has been pressing sales at various counters. This operator, with a bullish track record (not the one with ITC links), has sold close to 3.5 lakh shares of Satyam Computer yesterday. He is also reported to have offloaded a big chunk of Telco scrip during the past two days. Another leading bull operator is reported to have picked up over one lakh shares of Zee Telefilms yesterday.
A leading Singapore-based fund managers of a US fund also seems to be in a bearish mood. This fund has offloaded huge chunk of its holding some of the software stocks. Among the stock offloaded by this fund yesterday include Infosys Technologies, Pentafour and Satyam.
Pharma stocks continued to remain a remain favourite hedge even as rest of the frontline stocks were falling like nine pins.
Among the scrips which remained relatively firm as compared to other heavyweights included Novartis, SmithKline Pharma, Dabur, Burroughs Wellcome and Nestle. Marketmen said that despite an overall gloom scenario at the bourses, select pharma and software stocks continue to appeal to both local and foreign fund managers. Pentafour, NIIT and Wipro still continue to attract buying interest.
With the markets in doldrums, UTI seems to be back in action once again. All eyes are now set on what the big daddy will do in the coming days. However, it is reported to have sold a good amount of Bata scrip yesterday.