"Bear stearns Collapses on US bourses and Bears on prowl on every market"

Our indices had gap down opening as predicted, on weak US & Asian markets cues, traded in negative territory, since absence of buyers allowed every stock to have free fall. Sensex breached 15000 mark effortlessly and Nifty 4500, creating a panic like situation. While Sensex made a new low for 2008 at 14738.27; Nifty is in striking distance of January low of 4448.50; Bear stearns liquidity concerns sent the stock reach 4$ level by yesterday in just two days from a level of 58 $ from last thursday nightclosing. US fed came with an emergency 25 basis cut discount window for injucting liquidity, JP Morgan came as suiter to help Bear Stearns a bail out come take over, did not go well with markets world over. Investments in Indian companies by Bear Stearn viz., Orchid Chemicals, JP Associates to name a few, suffered huge losses, as the Rs.236 crores is realised on liquidation by the investment bankers in a single day trade to pay to Citibank and Meryl Lynch, as reported on Indian bourses.

Recession of US economy is confirmed by all economists and analysts, the mute point of discussion now is only how deep and long it will last?. Indian markets entered into a bear phase, which shall now continue till June 2009, as being indicated in our reports, and investors have to live with this volatility during this period. Bottom formation process when it begins, we will have the first clues of building portfolios, and investing in stocks. Preserving capital, staying in cash should be the main theme now on. The sentiment now with investors will be "Sell on Rallies" as the flow of bad news will have higher edge over good news, during the year at least till June 2008. FOMC meet begins tonight, the action or non action, the reading on their economy, inflation and interest rates will be minutely watched and dissected by the analysts around the world to know the future course of markets. Crude and other commodities are cooling due to profit booking a head of FOMC meeting;

Dow Jones closing positive, and asian markets opening and trading mildly positive would give some relief to our markets too today. With one more trading day to go this week, traders and investors would be exiting with small profits intra day, which will create two way movement, with roll over of positions next month series to commence from now on. Singapore Nifty futures are trading at 60 points premium currently indicates flat to positive opening for our markets today.

Range for the Day: Nifty might trade between 4400 to 4700 during the day.