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from Expert Zone:
India Markets Weekahead – Opportunity for those who missed out rally
(Any opinions expressed here are those of the author, and not necessarily of Thomson Reuters)
It was a second straight week of losses of 1.59 percent with the Nifty closing at 5,903. As discussed in this column a fortnight back, we are in a phase which would tire out the participants and change the mood to a negative consensus on the street.
After the sharp correction in most of the midcap counters, the mood has turned circumspect. The corporate results declared in the last few days too did not have much to cheer the markets but Central Statistics Office (CSO) GDP estimates of 5 percent for the current fiscal year seemed to have knocked the bottom.
The finance ministry, especially Finance Minister P Chidambaram, was quick to rebut these estimates as based on extrapolation of the past data which does not account for the green shoots seen in the last few months.
from MacroScope:
Stocks rally not sustainable: Prudential
Want the recent rally in stocks to last? Don’t count on it, says John Praveen of Prudential Financial. The Dow Jones industrial average is up over 20 percent since September, and has gained 7 percent since the start of the year. But Praveen sees too many headwinds for the boom to continue.
The pace of gains thus far in 2012 is likely to be unsustainable and volatility is likely to remain high as several downside risks remain. These include:
from Global Investing:
Calling CCCs
Junk bonds have enjoyed a rally since the start of the year but investors are facing a dilemma.
Should you buy larger, more liquid bonds that have already risen significantly, or buy smaller, illiquid bonds that have an attractive price?
from Oddly Enough Blog:
Sanity: you just know it when you see it
Blog Guy, you live in Washington DC, right? Are you going to that big Rally to Restore Sanity today?
You bet. I know lots of folks who are going.
But are you, as a respected humor blogger, allowed to take a political stand like that?
from Breakingviews:
Stock market rally celebrates bittersweet birthday
Birthdays are a good time to look back. The first anniversary of the global stock market rally -- the lows were hit on March 9, 2009 -- certainly brings back memories. It's easy to see why the MSCI World Index is 71 percent higher now than then.
Then there was a steep recession, now there is GDP growth. Then it was realistic to worry about such horrors as rapid deflation, serial banking crises and a competitive protectionism. All of those menaces have now receded. And stock market investors can be cheered to see companies sufficiently in control of their short-term destiny for most of them to meet or beat analyst expectations of reported profits.
from The Great Debate (India):
Bubble trouble for the Sensex?
(Nipun Mehta is Executive Director & Head - India, SG Private Banking. The views expressed here are his own)
At a Sensex level of around 17,000, are the Indian equity markets looking at the face of a possible bubble in the offing? Terrifying words, probably unjustified for a market which is still 20 percent lower than its all time peak touched in Jan 2008. Let's look at it from different perspectives.
from Global Investing:
“Normal” volatility to help rally?
As the graphic above shows, volatility in U.S. stocks has re-entered what could be called normal territory after soaring higher during the financial crisis. The blue band is plus or minus one standard deviation around the 1990 to 2007 avverage.
There may be an implication for equities beyond the obvious sign that things are calming down. Lower volatility is a buy signal in many trading models.
from Funds Hub:
Morning line-up
Hedge fund stories from the past 24 hours from Reuters and elsewhere:
Conservatives' Clarke tries to appease hedge funds over new rules - Times
Hedge fund firm NewSmith pays members 29 mln stg in 2008 - Reuters
Fund manager pleads guilty in Ponzi case - Chicago Tribune
Citadel's main hedge funds continue rally in September - WSJ
Despite '08 pain, the rich still like hedge funds - Reuters
Frontier backs synthetic over single hedge funds - FTAdviser
from Funds Hub:
Bearish Bullman
Stocks may have enjoyed a huge rebound this year (the S&P 500 is up 50 pct from its March low), but the rally is based on speculation, according to one hedge fund firm.
Bullman Investment Management, which runs a global macro fund, has just put on short positions on the S&P and the financials sector via ETFs, manager Nick Bullman told me.
from Funds Hub:
Octopus’s Crawford eyes FTSE at 5,000
Some good news for the bulls.
Octopus fund manager David Crawford believes this year's equity rally could lift the FTSE 100 to the 5,000 mark, from just over 4,600 currently, helped by energy stocks.
The call backs up that from hedge fund manager Crispin Odey, who earlier this year pointed to the start of a new bull market and then recently said there is "every reason to be hopeful that a major correction will not happen before September".
