• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• BL Club
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Our Bureau

Mumbai, Oct. 22 Nine out of the past 10 Diwalis saw Indian stocks rise after the festival. But with new and international factors at play, would this decade-long trend prevail this year as well?

Fidelity Funds Network has analysed the performance of domestic stocks over the last 10 years, comparing them for the 30 days preceding and 30 days following Diwali. The analysis showed that the Indian indices did comparatively better after Diwali than before, said a release from Fidelity.

Over the last 10 years, the average return 30 days before Diwali has been 0.26 per cent while the average return 30 days after has been 6.96 per cent, the release says.

The best year, with respect to post-Diwali returns was 2005, when the pre-Diwali 30-day period yielded a negative return of 8.22 per cent and the post Diwali period one of 12.90 per cent.

However, according to analysts, this time around there is more to the market than “the usual factors of bear and bull”.

The stock market has fallen below the psychological level of 10,000. It will be unlikely that the trend will change direction, said the head of a broking firm.

This trend does not really show any indication as it takes in to account only a month after and before Diwali, which is rather short term, said Ms Shahina Mukadam, Director, Varun Capital Market Advisory Ltd.

“Also if you change data period by even half a month here and there, the results will not be the same,” she added.

The markets will move more on the basis of events happening before and after Diwali rather than have any association with a 10-year trend, which could be incidental, Ms Mukadam said.

The continual selling by foreign institutional investors has been keeping the markets in a heavily bearish mode this year. This time everything seems to be turned upside down, said a broker referring to the heavy FII selling and the negligible amount of buying support in the market.

Only a reversal of the selling trend among FIIs can change the market direction, he said.

With markets having declined a lot, they might go up after Diwali, as the economic and corporate fundamentals are quite strong. But with markets that are supply driven, it is the FII selling which is a big issue, said Ms Anita Gandhi, Head of Institutional Business, Arihant Capital Market Services.

More Stories on : Stock Markets | Events

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line