Sensex poised interestingly in the 20000 range
India's premier stock index, the Sensex ended the day yesterday at 19956 points just shy of 20000.
The important point to note that it is the first time in a week that it decisively ended below the 20K mark. The fall of close to 150 points is quite significant. And this means that this is likely to exert psychological pressure downwards.
The apparent reason for this extent of an intra-day fall in the Sensex is reaction to jitters in the Euro area which was rocked by protests in some countries over austerity measures proposed by ECB to bring the area countries' sovereign debt load under control.
There could be some credence to the mainstream view that liquidity and buying pressure from the FII's that has taken the Sensex rally so far to the 20K.
It is interesting to note that while stock markets in the US (DJIA) were languishing in the 10200-10500 range from May thru August 2010, Emerging Stock markets kept going higher. Indonesia has now surpassed its 2007-2008 peak. India's sensex is pretty close to its 2008 January all-time peak
While DJIA is having its best run in Sept. and is now in 10850 range, rally in Sexsex appears to be halting.
It will be interesting to watch if Sensex can recapture 20K in this week or the next. If it fails in that attempt, it would likely be viewed as an ominous portent for the short term progress of the Sensex and other stock indices
Any struggle of the Sensex to get back to 20K and cross it, could likely signal the end of the September rally in the US and developed markets too
Lets watch the next 2 weeks closely for more signs
The important point to note that it is the first time in a week that it decisively ended below the 20K mark. The fall of close to 150 points is quite significant. And this means that this is likely to exert psychological pressure downwards.
The apparent reason for this extent of an intra-day fall in the Sensex is reaction to jitters in the Euro area which was rocked by protests in some countries over austerity measures proposed by ECB to bring the area countries' sovereign debt load under control.
There could be some credence to the mainstream view that liquidity and buying pressure from the FII's that has taken the Sensex rally so far to the 20K.
It is interesting to note that while stock markets in the US (DJIA) were languishing in the 10200-10500 range from May thru August 2010, Emerging Stock markets kept going higher. Indonesia has now surpassed its 2007-2008 peak. India's sensex is pretty close to its 2008 January all-time peak
While DJIA is having its best run in Sept. and is now in 10850 range, rally in Sexsex appears to be halting.
It will be interesting to watch if Sensex can recapture 20K in this week or the next. If it fails in that attempt, it would likely be viewed as an ominous portent for the short term progress of the Sensex and other stock indices
Any struggle of the Sensex to get back to 20K and cross it, could likely signal the end of the September rally in the US and developed markets too
Lets watch the next 2 weeks closely for more signs
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