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Posts Tagged ‘TCS Stock’

Market correction continues but Infosys,TCS shine

Monday, August 10, 2009 1 comment

Today was a yet another volatile day with bears finally managing to get better of the bulls. The opening was expected to be strong on strong global cues but the bears has their first pound of flesh in the morning when they outsmarted the bears.

The bulls did try to make a comeback in the afternoon but every high level was met with renewed selling. The NIFTY finally closed 1% lower at around 4440.

It has left all of us wondering -What next ? (This is the only question investors worry about!)

It might be better to divide the market outlook into long term and short term.

In short term- bulls are in real trouble and unless 4380-4400 holds on the NIFTY, it might be very difficult for bulls to recover. Below 4380, this market can slide another 3-4% in no time, with individual stocks correcting 5-8%. On the upside, bulls need a decisive move up (in a day or two) which takes the NIFTY past the 4500 level.We can then be sure about the resumption of the uptrend.

So if you are short term bull, manage your risk properly.It might be better to cut losses than regret later.

In the longer time frame, the upward trend still remains intact and will remain so till we manage to float above the 4000 mark. At the same time, there is a high probability that this markets goes into a sideways mode without making any decisive moves.

Looking at the bigger picture- the renewed threat of bad monsoon has made some investors a bit jittery. It is a fact that bad monsoons affect the rural consumer sentiment in a big way. On top of it, this also means food scarcity and food inflation. And  no stock market investor likes the prospect of lower growth and higher inflation at the same time.

Coming to individual stocks-Infosys was the star of the day. I have been emphasising that Infosys and the IT pack might be the leaders in this rally. I’d advise evry longer term investor or trader to accumulate the stock. Same is true for TCS, Wipro or Satyam, although they are a bit more volatile than Infosys.

Another star was the category of sugar stocks like Balrampur Chini.These stocks might continue to do well if monsoons fail and sugar continues to trend up.

Lastly, Cipla continues to do well. It was another star of the day.

Going forward- I’d be keeping a good eye on the commodities sector. Steel,alumnium,zinc and copper stocks might rally in a big way as soon as expectations for global growth return. So keep Hindalco and sterlite on your watch list.

Oil is slowly and steadily creeping up. This means keeping a close eye on RIL and Cairn India. It might be best to stick to the leaders in each sector.

This also means that we have to avoid a few sectors. Real estate is one sector which needs to be avoided. The sector is over owned by the retail investors and stocks have gone into a sideways or a downtrend.If there is any scare of interest rate rise in the system, these stocks will be hit really hard.

another sector to avoid might be telecoms. Both Bharti and RCOM are not looking great on charts. Bharti in particular looks vulnerable in the short term with critical supports around the 370 area. Short term traders might do well to avoid this.

Auto stocks like Maruti can be picked up if they become available at around 1000. The stock is still in a strong uptrend and remains a good pick.

So if you are a new investor, you might do well to be a little patient. If you are a momentum trader, it might be prudent to get out on trend reversal. If you are an intraday trader, you might continue to suffer with your mind preocccupied with guessing the next moves!

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Is this a bull market for INFY and TCS investors?

Wednesday, November 7, 2007 5 comments

Ever since I started writing on the blog I have been bearish on INFY and TCS. Infact my Infosys Trend Analysis post highlighted the importance of market trends by taking Infosys as an example.Ever since writing that post, I have made several people get out of their Infosys positions. Some at 2150, Some at 2000 and some at as low as 1850 also.

Today the stock closed at 1745 odd levels and fall was sharp. I feel that INFY is now entering a bearish phase and it might soon touch 1600 and subsequently 1350-1400. The probability of an acceleration in downward trend is much higher. So just stay out of this stock! Let the world analyze the stock, if you are losing money on this, you can still choose to get out.

Coming to TCS- The stock can fall to 870 levels if 980 gets broken on the stock.

I still fail to understand as to why people are sticking to these stocks despite such underperformance.

Just compare your returns if you had put 1 lakh in L&T and 1 lakh in INFY in June 2007 .

A 1 lakh in INFY would have resulted in a loss of 10,000 netting you 90,000.

A 1 lakh in L&T would have resulted in a gain of another 1 lakh netting you 2 lakhs.

Can you spot the difference? Not only did you lose 10,000 you also lost an opportunity to make 1 lakh.

And then people tell you that this is “bull market”! It is a bull market for the guy who has 2 lakhs in his pocket and not for the guy who is sitting on a loss and wondering what to do.

If you continue to be in such stocks you might end up losing money despite the bull run.

It pays to consider your “opportunity costs” while you sit on your losers!

Market Watch- BHEL, TCS,INFY

Wednesday, November 7, 2007 4 comments

BHEL is hitting new highs and TCS is hitting new lows. We are playing the trends by being long on one and short on the other. INFY is also back to 1750 levels which are strong support points to take a small countertrend trade.

RPL and RNRL continue to bleed and it might not be bad idea to do some opportunistic buying in RPL from a longer term perspective. There might be still more pain left in these stocks as leveraged players need to bail out and might be forced to sell at ridiculous levels!

Markets are still trying to make up their minds as to what they wanna do next. Its best to be on sidelines and take the next bets when things get clearer.

Market Outlook

Tuesday, November 6, 2007 2 comments

Yesterday was actually not a bad day as it looked. If you were in the right stocks, you might have made good money. Infact, this week has been just too good from short term trading perspective. RNRL has generated close to 80% returns in a week. I had missed this beauty last time but not this time!

Today is an important day from short term trading in NIFTY. Today’s market action can determine the future direction. I am still trading on the long side except for an odd TCS on which we went short close to 1100 levels.

I am seeing lot of action in individual stocks which might actually be good for taking short term bets!

INFOSYS and TCS still falling!

Tuesday, August 21, 2007 9 comments

INFOSYS and TCS continue to fall and hit fresh lows. Looks like they are the main “culprits” in bringing the index down.

Thats why don’t “assume” anything in the markets. Earlier analysts were saying that it is because of “rupee strength”. Now rupee has bottomed out, but still these stocks continue to fall. Now what is the latest reason?

Yes- you got it right.Now it is the ‘fear” of growth slowdown in the US!

The stock has fallen from 2400+ levels to 1800 odd levels and who knows where this downturn might end.

Reasons don’t matter-price does.As they say “the screen never lies”.

Read the “INFOSYS Trend analysis” and INFOSYS- A fundamentalist view” posts to get a fresh perspective on this.

Also read “After Wipro-Is INFY next?”.

Countertrend Ideas-Short term

Thursday, August 2, 2007 2 comments

Long:

Infosys has a strong support around 1900. You can play for bounce around these levels.

ICICI bank around 890.

TCS around 1100.

RCOM around 530 .

For short:

Maruti around 860

CIPLA around 191-192

Play with tight stop losses. Markets continue to to be volatile. You might not want to be “brave” and burn your fingers.When in doubt, stay “out”!