Sensex
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Abe
Nifty discount has slowly shown a steady decrease and presently near 10 points. I guess that could be buying entering the market.
In cues 5 mins is in buy mode and 15 mins is on borderline on positive territory. Whereas higher TF’s are still in negative territory.
Still risky to CF unless 1% SL is built in
Abe
Likelihood of a break out seen on cues. Indian mkt is already running b4 it…
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With Obama getting ready to kick ass… I guess 9800 will prove a good support for DJI….
Abe
Karur Vysya Bank-BUY BSE 590003 In Q4FY10, Karur Vysya Bank (KVB) reported financial performance in-line with our estimates on core income level and better than expectation on bottomline level. KVB's net interest income grew by 44% (Y/Y) to Rs1.64 bn (in-line with our estimates) and bottomline increased by 18% (Y/Y) to Rs989 mn compared to our estimate of Rs861 mn. We maintain our earning estimates and price target; we rate the stock as a BUY with a target price of Rs749 at 1.92x adjusted book value FY12. Some of key positives of the quarterly results were robust growth of 37% (Y/Y) in CASA deposits to Rs45 bn and improvement in margin to 3.37% from 3.32% in Q4FY09. On account of wage revision, the bank made provisions of Rs75 mn; out of total estimated wage revision provision requirements of Rs320 mn, the bank made Rs180 mn in FY10 apart from adhoc provision of Rs60.7 mn in FY10 compared to Rs57 mn in FY09 and Rs23 mn in FY08. Negative surprises of the result were increase of 14.3% (Y/Y) and 10.4% (Q/Q) in gross NPAs to Rs2.35 bn due to one big-ticket corporate account slippages from restructured loan book; the bank's management expects that by end-September 2010 the account would be upgraded. Increased composition (of 17%) of infrastructure sector in the bank's advances is also a matter of concern. Robust growth in business: In Q4FY10, the bank reported 29% (Y/Y) growth in total business on the back of 31.4% (Y/Y) growth in net advances and 27.6% (Y/Y) in deposits. In deposits, growth mainly came from CASA deposits; current and saving deposits grew by 36.6% and 37% (Y/Y) respectively. As on end-March 10, current and saving deposits contribute 10.6% and 12.9% to total deposits; whole-sale deposits (including certificate of deposits) were almost 25% of total deposits with average cost much below the bank's retail term deposit card rate. Under the gross advances, major sectors contributing growth were infrastructure and SME. Safe Harbor Statement: Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints. Nothing in this article is, or should be construed as, investment advice. |
Upside looks capped for now. Be cautious.
Abe
Britain: The Sun Has Set On The Empire Not the real big one - the United States. But one of the other big ones, the UK. According to ratings agency Fitch: "The scale of the UK's fiscal challenge is formidable and warrants a faster pace of medium term deficit reduction than set out in the April 2010 Budget. The rise in public debt ratios since 2008 is faster than for any other 'AAA'?rated sovereign and the primary balance adjustment required to stabilise debt is amongst the highest of advanced countries. The primary deficit is nearly twice as large as that seen in previous episodes of fiscal deterioration in the UK in the 1970s and early 1990s." Oh dear. And if you look at the chart below from Fitch, you'll see that the UK is keeping pretty bad company: There's no getting around it, the UK economy is in big trouble. You can see how big, by looking at a few of the figures compiled by Fitch. Take a look at these numbers showing the state of the UK government budget expressed as a percentage of GDP: Source: Fitch Ratings It's pretty unbelievable to begin with that the UK government takes 36.1% of the economy's GDP in taxation. A number forecast to rise to 38.3% by 2015. But worse than that is the expenditure. Not content with taxing too much, the UK government has been spending a lot more than it takes in taxes. The expenditure accounts for a massive 47.9% of GDP. In other words, nearly 50 pence of every pound spent in the UK economy is spent by the government. No wonder it's in such a mess. And with gross debt estimated to reach 89.2% of GDP by 2014 UK taxpayers appear destined to have a government debt albatross around their neck for many, many years to come. And what does the new Conservative and Liberal Democrat (ConDem as it's been labelled) propose to do about it? [Hehem] It plans on cutting spending by GBP6.24 billion. It sounds a lot, but when you put it another way, it's just a puny 0.4% of GDP. Makes you wonder why they're even bothering. And considering one of the biggest expenses to the UK government is the untouchable National Health Service (NHS), which cost the UK taxpayer GBP92.5 billion in 2009, it's hard to see how the government can either cut spending or pay down the national debt... Unless it inflates its way out of trouble. Which of course it has already tried to do with the so-called quantitative easing policy implemented by the Bank of England. But it's not just public sector debt that's crippling the UK. The whole rotten economy is at it. Our pals over at Wikipedia have compiled this table showing total external debt per country: The UK is second only to the United States in debt owed to foreigners. A whacking great USD$9 trillion of debt, or amazingly, 416% of GDP, or a USD$147,060 per person! You'll notice Australia puts in an appearance with USD920 billion, or 92% of GDP. And globally the debt figure stands at USD$56.9 trillion, which is only just less than the entire global GDP of USD$61.1 trillion: Look, when you're dealing with numbers this big it almost becomes incomprehensible. After all, many will argue that it doesn't matter what the size of the debt is, but rather the ability to service it. We've heard that argument plenty of times recently. It's been applied to companies, to property buyers and investors, and also to individual countries. The thing is, the size of the debt does matter. The argument about it being about the serviceability of the debt is just a smokescreen. In fact, you only ever hear someone talk about the serviceability of debt when they or the institution they're talking about is in too much debt. The total debt matters because that is the amount owed to the creditor, plain and simple. The debt must eventually be repaid. Arguing that the size of the repayments is all that matters just doesn't make sense. Besides, it encourages and leads to ever larger debt levels, which is what we've seen the world over. Think of it this way. If you lend a mate $20,000 and he agrees to pay you back $100 per week over 4 years then you might be happy with that. He's a mate and you're sure he's good for it. But then in a year's time when he still owes you $15,000 he asks you for another $20,000 for which he'll pay you another $100 per week, you might think, "Hang on, that's 35 grand I'm lending here..." And then another year passes and he wants another $20,000... and so on. At some point, as a creditor you're gonna start to get concerned about whether and when you're going to get your money back. Because all you've done so far is lend out money. You've received the weekly repayments but somehow you've got less money in the bank because you've continued to lend it out. And of course, you don't know how much your mate is borrowing from someone else either. Can he really afford to pay you back? Where's he going to get the money from? You soon figure out that you're getting a raw deal, and there's no guarantee you'll ever be repaid. It's the same, but on a much bigger scale in international finance. Creditors are lending money out getting repayments in return, but the principal is never actually repaid. Refinancing or new borrowings are just added on to the old debt and the repayments just get bigger. At some point it breaks down. Not just because of the serviceability of the debt, but rather because creditors realise they've been stitched up. They want their money back or they want better terms - ie. Higher interest rates. Or both! Think about it. Greece was more than able to service its debt. But only so long as creditors continued to lend it more money to pay for it. As soon as creditors started to ask questions and get toey then the whole thing fell apart. You see, it's vendor financing on a massive scale, "Here's a billion dollars so you can pay back the billion dollars you owe us. Now you owe us a billion dollars." That can't last forever. It's absolute madness and it's unsustainable. Yet the idea of serviceability of debts is gaining more traction among the mainstream drones. We witnessed the excitement on CNBC a couple of weeks ago when Erin Burnett and Jim Cramer went bonkers after figuring out the US debt costs were less today than they were two years ago, even though the debt is larger. Why? Because interest rates are lower. The size of the debt doesn't matter, it's the ability to service the debt, was their claim. But this is what happens when you have a central bank manipulating the interest rate. Luring investors and speculators in with sweet smelling cheap money. However, the endgame won't be so sweet when creditors decide they want their money back, want a higher rate of interest, and/or they realise cash is being devalued at such a fast rate that they no longer see any value in it or in lending it, but instead prefer real assets. That's the point at which inflation gets out of control. As individuals and investors seek to dispose of cash as quickly as possible in exchange for something tangible. And don't for a moment think that it can't happen because thanks to the central bankers, bankers and governments, it's destined to happen. So next time someone tells you it's the ability to service the debt not the size of the debt, don't believe them. Safe Harbor Statement: Some forward looking statements on projections, estimates, expectations & outlook are included to enable a better comprehension of the Company prospects. Actual results may, however, differ materially from those stated on account of factors such as changes in government regulations, tax regimes, economic developments within India and the countries within which the Company conducts its business, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints. Nothing in this article is, or should be construed as, investment advice. |
Hello everyone,
There is an Inverted "Head and Shoulder" formation in NIFTY which is a bullish sign for short term. If Nifty donot sustain below 4875-4930 on 2 day closing basis one may expect 5400-5525 in Nifty. Yes immediate 500 points upside in NIFTY.
But if suppose it was a failure and sustained below 4875 and breaks 4700-4790 intraday then one may expect big panic. the fall may be upto 4500,3800-3600 in NIFTY.
Overall we have already said one big fall expected in NIFTY. 20-35% fall in NIFTY.
Uttam Saraf
Attachment(s) from uttam saraf
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Cues indicate a sideways move with upward bias…. After an initial drop of 0.2-0.3%.
It is still wait and watch for long players except in sugar…
Abe
