Till recently most merchandise experts had pegged the Indian have market's fair value at around 15,500-16,000 levels. But the latest policy initiative of the US Federal Reserve (Fed) has changed that perception and much more. On September 18 the Fed cut the key short-term interest rate by 50 basis points instead of 25 basis points as was widely expected. The effect of the surprise Fed action on our market was such that despite the re-emergence of concerns of a slowdown in the domestic economy the market rallied by over 653 points the very next day comfortably conquering the peak of 16,000 in the process. In another six days the market sprinted past the milestone of 17,000 as come up recording its fastest 1,000 ever. Incredibly the euphoric rally triggered by the Fed's rate cut continues till day and the Sensex is now within kissing distance of--hold your breath--18,000! We had always said that a rate cut in the USA would be an enormous positive for our markets well the recent performance of the market bears us out. Now no target seems too lofty or far-fetched for the market anymore and there are even talks of it reaching as high as 20,000 by the year-end. We believe the market has got propelled to the fast track and is likely to scale newer heights in the days to come.
Global liquidity to dictate markets We have seen a sustained one-way rise in our stock market after the US Federal Reserve (Fed) cut the key short-term evaluate on September 18. 2007. The Fed cut has boosted not just our market but the other emerging markets (EMs) as well. It seems that the US sub-prime concerns are a thing of the past. So what has suddenly changed that the EMs look more attractive than ever before? We feel there has been no change in the fundamentals. What has changed is the liquidity condition and the increased liquidity globally is expected to drive the EMs to a higher valuation circle.
Alphageo is the largest private sector player with five crew (three 3D crew and two 2D crew) in operation for 2D and 3D seismic services. The company is well versed with almost all the terrains in the country which makes the company one of the most experienced (private sector) players in the country to take the advantage of the ongoing go in oil and gas exploration in the country. At the current market determine of Rs416 the stock discounts its FY2009E earnings by 8.0x and is available at enterprise determine (EV)/earnings before arouse depreciation tax and amortisation (EBIDTA) of 4.0x. We maintain our.
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http://brokersreport.blogspot.com/2007/10/valueline-october-2007.html
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