Market Outlook- Global markets down again!

Lets admit it- This market is a nightmare for short term trading. With the global credit crisis coming to surface again and the global markets taking it on a chin, we are again preparing to go back to the levels from where we started! So a whipsaw on long positions is inevitable. This is part and parcel of a trader’s life!

One important development though- Dow is placed precariously close to its support levels and any more bad news can result in US indices nose diving by another 7-10% in no time! What effect can it have on global front, remains to be seen.

Will it result in more dollars flowing into Indian equities or will it result in global equity aversion? My sense is that US shall go for a recession but I am more interested in understanding the impact of this recession on IT companies in India. If the effect is neutral to slightly positive, then we might be on an easy terrain.

In the passing, there is a lot of buzz(read rumour) that Wipro has actually managed to take over Cap Gemini for a couple of billion dollars and it might be one of the largest acquisitions India has seen. Very interesting!