The euphoria of the morning turned to gloom by the time trading ended yesterday. Participants who were suckered into picking up stocks on seeing firm prices were left high and dry by the fag end.
The volatility of the recent past was again in full evidence yesterday, with rumours flowing thick and fast.
Predictions have thus become perilous affairs, what with day traders calling the shots and there being no intra-day trends.
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A section of the market is of the view that as long as valuations of ICE (information technology, communications and entertainment) shares remain an exercise in esoterics, volatility will continue.
Pharma prescription
The panic sales during the latter part of the day has reinforced the need for some good pharma stocks in one's portfolio.
The ministry for chemicals and fertilisers has recommended an abolition of customs duty on 116 types of equipment used in R&D by the pharma industry. It is speculated that the implementation of this latest policy initiative is only a matter of time.
Also, the potential market for the drugs going off patent in the year 2000 is around $7.5 billion in the US market. This does offer good Indian Pharma companies which have an edge in the generic markets on account of their cost advantage an additional market to make inroads into.
The view on the street is that attention would shift further to domestic R&D-oriented companies _ as they gear up for the post-product patent era.
Infy stumbles
With Infosys Technologies coming under the sell hammer of two big foreign institutional investors (FIIs), the scrip's fall was quick and hard. Substantial redemption pressure faced by Uncle Sam is believed to have triggered the latest round of selling. The stock witnessed a dramatic tumble and wound up at the lower end of the circuit filter. Sales of 1,50,000 Infosys shares by Uncle Sam had being confirmed. The fact that one of the biggest FIIs is selling one of its rare multi-baggers has unnerved the broad market.
The Silver Bull bared its sweet tooth with its latest recommendation on Cadbury. The broking house
is impressed by the company's new marketing mantra of "a Cadbury in
every pocket". It also expects the decline in international cocoa prices (35 per cent of the company's total raw material cost) along with cost control measures to reduce its operational cost
per tonne.
However, Silver Bull does express concern with respect to decline of chocolates in the overall `Impulse market'. Then there's also the issue of the grey market in the form of imported chocolates.
ICE doesn't melt here
In the Internet era, telecom solutions and bandwidth will have primordial roles. The curiosity as far as these media are concerned was in full reflection during the recently held India Internet Show in Mumbai, which caused a virtual stampede.
The Common Fund entered this territory yesterday aggressively, mopping up 5,00,000 shares of Global Tele-Systems. The impact on the scrip's price was in full evidence. The fund is also believed to have evinced interest at the Zee TV counter.
Tailpiece
India's largest stock exchange is facing a virtual exodus of staff, exasperating its top officials. Handling market volatility and rumour-mongers was in itself a tough business for it, but this flight adds a new dimension to its worry list. The bourse's employees who were searching for avenues till a few months back are now faced with the unique difficulty of choosing from at least three. Times are a-changing, indeed.