Friday could witness another interesting bout between the bulls and the bears, now that it has come to light that the fall yesterday was largely speculative in nature, with institutions being net buyers.
With only the National Stock Exchange remaining open for trading on Thursday, there is a chance that the bulls could pull up the bourses, thereby forcing the bears to cover up their positions at higher rates.
Interestingly, both short and long positions have gone up marginally since Friday, fogging trend in the process. Even if there is brief rally on Friday, sustainability remains the key question.
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On the positive side, domestic institutions which have been generally inactive on account of Diwali holidays could get into action, thereby providing support. But on the flip side, the safe haven status enjoyed by the India seems to be coming under a cloud. With other Asian countries showing gradual signs of recovery, leading players fear a flight of capital to those areas.
Still in reverse gear
A leading US-based fund seems to be determined to clean its portfolio of Telco shares judging by the manner in which it is offloading them. It has already offloaded 35 lakh scrips in three trading sessions (excluding yesterday). Analysts feel there is more to come considering the size of the fund's holding at the counter.
Clearly, this seems to be one of those bets which badly went wrong considering the fact that the fund had acquired these shares at nearly 3 to 4 times the prevailing market price. Part of the portfolio-cleansing drive could also be attributed to the induction of two new fund managers into its ranks.
Troubled spot
Zee Telefilms could witness some fireworks in the trading sessions to come. The scrip witnessed sharp volatility yesterday, first plunging to Rs 561 on the Bombay Stock Exchange (BSE) and then rebounding to Rs 624 at close.
It is learnt that Zee bears have been caught on the wrong foot by sudden institutional buying interest at the counter towards the close of trading. A leading US-based fund which has been so often accused of conniving with the bears is reported to have picked up 3 to 4 lakh shares yesterday.
Moreover, another foreign fund, too, is reported to have bought around 95,000 shares. There was a short position of 1.53 lakh shares at the counter on Friday. This figure has almost doubled to 3.06 lakh shares yesterday. Against this, the long position has increased marginally from 5.28 lakh shares on Friday to 5.99 lakh shares yesterday. Unless there is a fresh bout of selling from foreign funds, bears could be in a tight spot on Friday.
Software softens
Following the announcement of first-half results of key software stocks, the story at these counters seem to be over at least for the next three months. With most frontline shares taking a beating, fund managers are now turning to software counters to book profits.
Yesterday the prices of most software companies were under severe pressure.
Anti-climax
Trading in HCL Infosystems was frozen for the second consecutive day on the BSE and the NSE after there were only sellers at the counter. When the scrip had entered its no-delivery period four weeks back, the entire market was upbeat on software stocks.
Too many speculators jumped onto the HCL bandwagon in anticipation of reaping a windfall. The scrip did show promise initially, spurting from Rs 220 to Rs 285 in a week. However it stagnated at those levels since then even in a volatile market.
Players on the NSE who stayed long at the counter till the last minute in expectation of some miracle were in for a rude shock. Many of them were unable to unwind their positions after trading was frozen for the last days owing to lack of buyers.