TechECE

Man this is not the first time things like this have been unearthed!!! And the previous incidents dint hurt the sensex at all :)

i havent read the link u posted btw - so i dunno whether this is something similar!!!

 

I had applied for IndiaBulls da... Anyway didn't get the account details yet and didn't start trading, BTW I checked out: Your DeMAT account will still be safe. Machi sensex falling back to four digits is not a joke da. The axe will be above our head. I think you only see from the perspective of people who invest in shares will incur losses. Well market spiralling down will have adverse impace on all the sectors, especially the 'bubble' IT.

 

same here da sunil. myself, prad and kicha applied for IndiaBulls as they said no charge apart from transaction charges. as u said the demat a/c holders wont have problems. SEBI is always viewing the bull run with suspicion. they even brought a cap for hedge funds much to annoyance of fin min. so, less worry da.

 

Okie - the sensex dropped and regained!!!
All in a single day - and its only noon now right!!!

http://ia.rediff.com/money/2006/apr/28sensex.htm?q=tp&file=.htm

BTW - the article says around 24 operators have been banned from participating in the market. Now that's some news :)

 

Pradeep: I was thinking this way. The boom in the stock market was fuelled not only by performance of the companies but also lot of 'market sentiments'. I mean the stock prices of a company going up may not necessarily be a reflection of their performing well. But no matter how it went up, the stake holders and investors will be happy and you'll attempt to expand and invest on more risks in your business. The stock prices have undoubtedly contributed their part to the boom in job market and the positive atmosphere that prevails. Now for a moment let us think the stock prices of Indian companies grew 99% because of performace and other factors and 1% because of the 'market' sentiments. Even then, if now the market crashed for some stupid sentimental reason and not because of your performance, you'll be punished for no mistake of yours.

 

Hey sunil - i accept ur arg on Market Sentiments. But on the longer run (read - before the day ends) sense will prevail. The market crashes at times coz of these sentiments and the market booms too at times coz of the same stuff. But if u look at the entire day - the market would have realised what's going on and stabilised.

 

machi stock market is always volatile. if entire community thinks there is something wrong, index wud come down no matter what the actual peformance is. ex- ambani brothers fight, government change, stock scandals. Situations like this wud bring stock prices down and it wud affect every industry alike. may be that is what sunil is trying to stay.
This period of volatality and subsequent stability is not a single day as iday said. it cud be any longer. For example, the market was expecting BJP govt. to come to power. but left supported UPA came to power. Suddenly prices went down and it took three weeks or so to stabilise. To put it in most ambiguous way - It depends machi.
Bottom line - price is not all that dependent on performance alone. it depends on hope, fear, sentiment etc.

 

Yes da Ram. The exposure of this scam could trigger more digging into the stock market and it might endup like 91 where the markets crashed like anything. The press is very powerful now that they could even simulate a false environment before public, which could endup in the downfall of the market.

 

Well!!! When a whole market runs on SPECULATION, things that ram mentioned - hope, fear and sentiment are bound to be major factors :)
Anyway - one day was a best case analysis machi. For the Ambani example u mentioned - the stock prices went low for wuite some time. But the day they made their announcement, all their stock prices shot up right!!! Think of someone who bought the shares during this earlier period of lull.

Moral of the story - some u win, some u lose. but the story goes on.

The only thing, IMHO, that will hurt the sensex is the economic situation of the govt or the country as a whole. There are lots of factors involved in what we term simply as ECONOMY. This is what bodies like RBI, SEBI et al are working to control and kep things stable :)

 

Idaya - I didn't mean we are doomed :). I was not talking specific to this problem alone. In general the virtual debate going on b/w me&pradeep is : will a crash in stock market affect a company?

pradeep: I'll try to explain my point. You float you company stocks at, say 100 per share. Your capacity and capability at initial stages will be limited to the amount you raise through stocks, which may also include the VC you gave you the money as a trade off for your stocks. And obviously you will have your own part of the shares based on your initial investments. Later, people who make the difference in markets, like the FIIs or some big investors (as mutual fund guys) get a confidence that the XYZ company of Pradeep would do great in future. So they start buying your shares. The cost increases with the demand, so your investors would have more money and will be more than happy to help you grow. You, as org which has some shares for its own will have more money. Your logical next step is expand. Get into more risky business and hire more and grow. A 'risk' investment, as I would define is to venture out on projects that will give very good long term returns but a liability at short term, like R&D. Now all of a sudden your stock prices take a deep plunge. Naturally your investors and stake holders will be skeptic and you'll tend to shrink yourself. - Downsize or Rightsize.

 

Karthik, just curious. You've always been pretty negative about the sensex. Any specific reasons? :)))

 

Sunil: 1)Negative abt sensex?! May be bcoz of my grudge on all those guys who made money in the booming stock market.

This may be an interesting article to read at this point of time...

http://www.equitymaster.com/p-detail.asp?date=3/30/2005&story=1

 

@Sunil - Point taken.

Karthik is perhaps expecting the famous Warren Buffet statement to come true in the near future :)

 

Eat this guys: As we discuss about the falling market a guy in my team had made 8 Lakhs! (Some fno share, I don't know what e talks)... Karthik - it is that wipro guy i used to talk about

 

@Sunil and Prad - What pradeep says looks more logical but not sure how the whole system works.

@Iday - What did Warren Buffet say abt market anyway? All I knew was that he had aversion towards investing in share market and he preferred investing in commodities like gold and silver.

 

@Sunil - Yeah. At least in the recent years (3 years), we haven't heard any sad stories in the stock market. Thanks to the bullish market.

 

Karthik!?!? Warren Buffet had an aversion towards investing in stock markets?!?!
He'd run, yeah RUN, all the way from his BH office in Nebraska to kick ur ass :)
He's made a living by investing in shares. Remember that u r speaking abt the student (a most preferred one that too) of Benjamin Graham and the only one to whom Mr.Graham ever gave an A+ in his paper (on equities i guess).

Prad - how do u say he has an aversion on Tech stocks?!?! He speaks so highly abt MS and Google. I think he's not too keen abt Tech stocks coz he does not wanna venture into a segment he does not know or understand. He said that he'd understand the future of Coke better than that of MS. whatever that means :) Isnt that the common Investor trait - play the game in a field u know well!!!

And yes - abt what he said. He said, as a matter of fact ofcourse, that every bull term in the market is bound to produce a lesser exciting period. Not that he was a pessimist or something like that. In fact, the bear time was when he sows his seeds ;) And it is not a generic statement too - something like the whole market craching. Every company goes through these phases. Buy when the shares sell cheap and sell when they grow!!!

Well if u've got the money he has - we'd be doing what he does. Buy (in huge volumes i mean) when the shares sell cheap and become a board member when the company starts doing well ;)

 

Hehhe...
Sensex zooms past 12000 :)

http://in.rediff.com/money/2006/apr/29sensex.htm