The Nifty opened higher, almost a gap of a 100 points, then slid during the final hour of trading, to close virtually unchanged at 4030 (Friday's close at 4016).
The Nifty now seems to be in a well defined trading range between 3850 and 4100. The Index has spent five trading days inside this range, giving this trading range some credibility.
When we see a trading range develop, trading becomes easy. A breakout above the resistance (4100) is a buy while a breakdown belwo the support (3850) is a sell. Short term traders should follow this while trading the Nifty.
Here are some snippets of information to cheer you.
A report by Morgan Stanley titled: "How long will the bear market last" says:
Sentiment is very weak and is best reflected in how poorly India has fared relative to emerging markets. This is about the worst performance in more than a decade on a year-on-year basis. However, domestic households seem convinced that equities have to be bought and not sold. We think for the market to bottom-out, these investors need to panic.
That's not all. Here is some more:
The currency is depreciating, growth is slowing, crude oil prices are rising and inflation is at new highs. This is a bad macro recipe for equities. ........ Ultimately, for the markets to bottom, crude oil prices need to decline, global risk appetite has to revive and help the Indian currency and thus stop long bond yields from rising.
[My Notes: So who is going to order crude prices to come down, force global money to India & reduce inflation ?. Will it happen by executive order ? ]
But, there is good news also. The report says:
For genuinely long-term investors, cash flows (i.e., dividends) are now available in several parts of the market at a reasonable price.
UK feels pressures of recession
A bloomberg report says:U.K. manufacturing unexpectedly contracted in May to the weakest in eight months, choked by record commodity prices and slowing economic growth. .......``The outlook for the economy is clearly deteriorating and the risks of a recession are rising,'' said Nick Kounis, an economist at Fortis Bank NV in Amsterdam
Britain's economy is at risk of falling into a recession as house prices slump and surging oil prices squeeze purchasing power. Marks & Spencer Group Plc lost a quarter of its value on June 2 after saying trading conditions won't improve for two years.
The Political Drama in Delhi is simply astounding.
It is said that the people of a country get the government they deserve. What did we Indians do in our past lives to deserve this ?
All of the above no doubt makes cheerful reading, just before bed time. Here is a ZEN story to make you feel better.
There is a Taoist story of an old farmer who had worked his crops for many years. One day his horse ran away. Upon hearing the news, his neighbors came to visit. "Such bad luck," they said sympathetically. "May be," the farmer replied.
The next morning the horse returned, bringing with it three other wild horses. "How wonderful," the neighbors exclaimed. "May be," replied the old man.
The following day, his son tried to ride one of the untamed horses, was thrown, and broke his leg. The neighbors again came to offer their sympathy on his misfortune. "May be," answered the farmer. The day after, military officials came to the village to draft young men into the army. Seeing that the son's leg was broken, they passed him by. The neighbors congratulated the farmer on how well things had turned out. "May be," said the farmer.