The Hindu Business Line : Stretched valuations

Khan was comparing India's high growth rate against the US' low of 1.3 per cent. Who will win the ABN bank, Jogin was wondering. And Dakshinamoorthy was studying the reserve ratio hike of China... Till Sridevi drew them to the chat table. Pull a chair!

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Sri: Hi! April 2007 has been a very strong month...

Kay: For the stock markets across the globe.

Dax: Liquidity has been effusive.

Jog: FIIs have pumped in over $1.5 billion in April.

Kay: In one month! Into Indian stock markets!

Dax: Is the zone above 14k so dangerous that...

Jog: That all turn nervous and start selling?

Kay: Brokers tell clients to take their call after 14k!

Sri: Nifty was down sharply on Friday. Overbought?

Kay: Following global cues and inflation numbers.

Sri: In April, Nifty rose nearly 7 per cent.

Jog: On closing basis, up to last Friday.

Dax: So the correction is good for markets in general.

Kay: Nifty has support around 4,010 levels.

Sri: On the downside. And further at 3,940 levels.

Jog: RBI is optimistic about 5 per cent inflation levels.

Dax: We are approaching May!

Sri: When fund managers sell and go on vacation?

Kay: A repeat of May 2006 is however not on the cards.

Jog: Oil marketing companies such as BPCL...

Dax: HPCL and IOC will be hurt by high crude prices.

Sri: Hike in petrol prices can provide some relief?

Kay: Mid-cap and small-cap IT companies...

Dax: Can they weather the rupee appreciation?

Jog: Ditto with the large-cap IT companies?

Sri: No major slip-ups expected, in my opinion.

Kay: Falls may be stock specific.

Jog: Like the hammering Cipla took after results?

Dax: Infosys and TCS bottled by strong rupee.

Sri: Once things cool down, they are due to unleash...

Jog: Some power? Then new-highs...

Dax: Would be a reality, not mere talk!

Kay: Watch out for cement despatch figures!

Sri: For April. Automobile monthly figures, too.

Dax: SEBI's tough posture, IPO-related...

Jog: Could slow down flow money into markets?

Dax: Bank stocks could be edgy...

Sri: Following firm inflation numbers, I fear.

Kay: Newly listed stocks evince hectic activity.

Sri: Only for a few days. Then, gradually sidelined.

Dax: IFCI and Idea Cellular, strong buys...

Sri: Recommended by brokers? Bharti stock...

Kay: Faced selling pressure last Friday.

Jog: Despite good results! Profit taking?

Dax: The stock, a sure buy on declines.

Sri: Ranbaxy showed excellent results.

Kay: Also faced the bear music! Investors can wait...

Jog: As it raised guidance for the next quarter.

Sri: Container Corp, an investment opportunity!

Dax: Results were strong. Godrej Industries...

Kay: Also a buy on the downs.

Sri: Now that we are nearing the all-time highs again...

Dax: Stretched valuations will become a worry.

Jog: Time to keep a balanced head on the shoulder.

Kay: And do not get carried away. Bye!

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Lee with inputs from Mad, Lok, Bad, San and Bij.

Blog at http://MarketChat.blogspot.com