Sub-prime! Forex derivatives! Mortgage securuities ! Bailout !Chapter 11 …. Glossary list increasing ..

Sensex Technical View :

The markets may have got very dicy and volatile but for Sensex technically the analysis do seem a lil simpler out here. We have been consistently making use of the small/big bear rallies from time to time . Currently after 14200 booking partially its been a waiting time to re-enter with cash on hand. 12500 holds the key for now and 14500 on upside to make technical decisions to turn either side. Below 12500 the drop could very well go to 11500-11900. Volatility would remain very high till either side of the market range is broken and needs to be cautiously traded.

Stocks to watchout for :

Not much of trading picks tonight but a briefly sectoral view.

Private Banks :

For last so many months i have beeen highly critical of the private banking sector stocks like ICICI , Kotak etc etc . It was a big avoid then but if they do crack another 10-15 % from the previous lows then i may definitely go in for a stock specific look as the market consensus is changing to gloomy which could provide opportunities but still waiting for a technical reversal coz the sectoral picks can remain sideways also.

Real Estate Stocks :

Alongwith pvt banks i had mentioned on real estate stocks about an avoid as we dont know technically or fundamentally where can they settle on downside. Excesses of a bull run can correct to 90 % from top which was seen in tech boom. Although there might be pockets of opportunities which i may not be aware of. So look for big cos closer to 80-85 % frm highs as per previous history of markets.

PSU banking:

I continue to remain highly positive on this sector as i have been before on BOI , SBI etc in previous dip to 12500. These stocks are quoting at 30 % + higher then July lows. As not many have corrected the focus goes to smaller PSU banks which also have a high dividend yield and good book values. Best picks - Andhra Bank , Allahabad Bank , IOB , Vijaya , Dena etc.

Sugars :

Continue to remain bullish on the sugar stocks in the medium term. Best picks Renuka , Balrampur Chini, Sakthi Sugars , Andhra Sugars. But with a technical bias the charts do suggest high volatility and frequent dips so one should take exposure only on dips. Other sugar stocks may have potential but needs much more specific study. Even Tea stocks look interesting but options are limited to Mcleod Russel , Harrison Malayalam.

Will be updating stock specific and detailed updates as a little tired tonight. Sunday Thoughts may also be posted soon on sub prime or etc .

Best Regards,



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