Q2 results : Is there a delay ?

When companies delay the publication of Quarterly results, investors should be worried. Why the delay ? Here are some companies who have announced the dates. Watch out for the late comers.
Brokerages:
MOTILAL OSWAL FINANCIAL SERVICES LIMITED 10-OCT-2008
GEOJIT FINANCIAL SERVICES LIMITED 11-OCT-2008
Media:
NEW DELHI TELEVISION LIMITED 14-OCT-2008
IT:
INFOSYS 10-OCT-2008
HCL TECHNOLOGIES LTD 15-OCT-2008
MPHASIS LIMITED 16-OCT-2008
SATYAM 17-OCT-2008
Banks:
AXIS BANK LIMITED 13-OCT-2008

Where has technical analysis gone ?

Almost all the email / comments I receive in this blog have been appreciative. Now, like a favorite student admonished by the teacher, I am receiving comments that I seem to have strayed from the path of technical analysis.
Guilty.
The Nifty closed at 3818.30, the lowest weekly close since 8 April, 2007. If we are closing at the lows of 18 months, we are in a bear market.
Follow the trend, is a basic maxim in technical analysis. Then, most of our trading should be on the short side. The bear market is assumed to continue until proved otherwise. What is the proof of a new bull market ? If the Nifty closes above 4300 (the last intermediate high), we may well say that a new up move has started. (The 4300 number will change with time).
Within an intermediate down trend, there will be sharp rallies. This is the nature of the bear market.
Trading, then, is possible for taking short positions on rallies (going with the primary trend), and, also for intra day / 2 or 3 day up moves that can emerge suddenly.
Weekend cheer:
Goldman Sachs now predicts the US recession will be “significantly deeper” than previously thought. ‘Headline’ unemployment (the number cited by the Bureau of Statistics) will reach 8% by 4Q09. Also, 3Q08 GDP growth will be 0.0% at best. U6, a broader measure of unemployment and underemployment used by Bureau of Labor Statistics but not often publicized, now stands at 11%.

What Lies Ahead ?

The most painful part of the bear market may be in front of us. This could be the last leg of the bear. Stock prices start falling because there are no buyers left. The last of the bulls will slowly sell off. There is a complete disconnect between ‘value’ and stock prices. Many blue chips start selling for what may be handsome value in normal times. But, these are not normal times. Slowdown, recession, destruction in asset prices, become commonly used words. Even this phase will end, but we do not know when. It could be six months, or it could be three years.

How do you cope up in environment of pessimism ?
If you own stocks, switch from momentum stocks to blue chips. Try to create marketeable lots, meaning lots of shares equal to their futures lots. (Example: 1 future in Reliance Capital is 138 shares. if you own Rel Cap, try to make your quantity equal to 138). once you have such lot sizes, consider selling calls against your equity holdings to reduce the cost of your investment.
If you are in cash, either wait for a base formation, or buy small percentages of your available cash in panics, say 5% every time there is a dip.

Comments to this post :
comment:
if the bear markets are to terminate six to eight months from now then satyam @225, kotakbank @ 350, Dlf @ 175, Nifty @ 3175 is a possibility. Do you agree?
My response:
Yes, this is possible. We are in a bear market. Prices will move lower. We have no way of saying when the down trend will end. Maybe now, maybe later. The bear market is assumed to continue until reversal signals come in. Such signals have not yet been seen.

comment:
Gold & crude going downside, generally it has been observed that when it goes down Indian market goes up, but now a days no co-relation exist, whats your view ?
My response:
I can only repeat what the economists are saying. Commodity prices are falling due to ‘demand destruction’ , meaning a slowdown or a recession in the western economies. Therefore, our stock market is under pressure since we are likely to be affected by any world wide slow down.
Yet, what could happen if crude were to fall to $50 ? I do not know the answer. It is wiser to track the price charts. the charts will tell us what may happen.