Lack of any FII inflow coupled with the movement of liquidity from the secondary markets to the primary one led to the Sensex falling by over 700 points in intra-day trading before the Sensex recovered almost 350 points from the day's low. This movement of liquidity is attributable to the Reliance Power IPO which mopped up over Rs. 1 trillion yesterday, with the market expecting the IPO to be oversubscribed several times over.
This fall was only a correction; the bull story of the markets remains intact until the financial budget! However, the sensex may be prey to more whimsical (volatile) moves of this sort during this period. Smart investors would do well to keep atleast 10 percent of their portfolio in cash and book their profits on every rise! Though global cues have been pretty discouraging, the Indian markets are no longer being dictated by the overseas concerns. Sure, there is some effect but the overall mood is that of optimism!
So stay invested in this bull story & enjoy the SenseXXXational Ride!!
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