Stock Market Institute: Post Market Commentry (3rd May 2012)

Posted By : Kishore B.S


The Market breadth remained largely negative today ahead of the ECB meet scheduled today to discuss the Economic Outlook of European Nations and if further Easing is required.
The negativity in the markets was largely due to unwinding of long positions in the Auto, Banking and Reality stocks and sell-off also to some extent. The lower than expected sales figure of Auto companies for the month of April and also below estimate results gave way for the sell off. Most of the Front line Auto stocks have corrected by nearly 10% in the last two trading sessions.
The banking sector too joined in the sell off by investors and traders due to fears of RBI tightening the lending norms further and worries of raising NPA’s to some extent as well. Though the banking sector has largely given better than expected figures but have failed to retain investor fancy due to the impending slumpiness in the markets during the month of April and traditional view that the month of May would remain negative.
And finally the reality sector also contributed to the fall with some amount of sell off in major names like DLF, HDIL due to fears of decrease in margins and also decrease in sales.
Overall the trend remained largely negative with the indices holding on the 5170 mark for the time being and closing above that mark. Now it remains to be watched closely tomorrow for the outlook of ECB and its impact on the Asian Bourses which could pave way for the much desired direction ………. which could be a lower breakdown below 5140 levels to touch 5000 mark or some relief rally within the range of 5170-5330 range.

(Inputs: Mr. Hemanth V, Faculty TA, Stock Market Institute, Bangalore)


Team SMI

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