W4L12_Tutorial - Assignment 1 - Analyzing the financial performance of a...

BSE Sensex Reached 17000 Mark

Today BSE Sensex reached 17000 mark and Dalal Street is moving fast. Major gainer of today are Jaiprakash Associates, Tata Power, Reliance Industries, NTPC and Mahindra & Mahindra because of positive post budget sentiments and news of Greece economy bailout and extra austerity measures totaling 4.8 billion euros ($6.49 billion) Greece's cabinet.

FII sentiments seems positive and fresh buying are seen in market.

I am hopeful that BSE sensex will reach 20000 mark in this year only but before buying anything check the individual analysis of share.

Also monsoon will have its own impact on market / investors sentiments.

International Financial Crisis

BSE Sensex which is around 22000 (Twenty Two thousand) mark in March 2008 had gone below the level of 11000 (Eleven thousand). All the major scripts like Reliance Communications (RCOM), ONGC, TATA Steel, NTPC, SAIL, State Bank of India, Relinace Petrolium (RPL), Reliance Infrastructure, etc. have lost more than 50% of their 52 weeks high and some of them have touched their 52 weeks low or lost more than that. High Inflation Rate is other major factor which is standing behind slowdown. I hope that share market will recover after the election when new Central Indian Government will be formed. I hope by May-June 2009 Sensex will cross the 15000 mark.

Above mentioned slowdown is the result of dependence on FII money / Foreign Investors and financial failure of US economy players like Lehman Brothers, Goldman Sachs, AIG International etc. Even many other European & banks/financial institutions of other countries are also seeking help from governments of their respective territory. Some banks and financial companies have received the help from central banks of their nation to save themselves from bankruptcy. Before the slowdown whole world is working in the style of American system which is failed now and due to same whole world is facing financial crisis.

Still I think the financial crisis has not shown its full powers and can lead to bankruptcy of some nations and failure of financial/banking/insurance companies worldwide. IMF, World Bank and other international financial organizations are worried and looking for ways to save the whole world from financial crisis which happens because of virtual creation of assets and too much over estimation of assets or we can say a hype of too much over estimation by private sector players without any intervention, monitoring by Governments of their respective countries.

In long term the unemployment, Inflation, political & other concerned crisis are not estimated till now which have much bigger impact on society and humanization.

Lets come forward to save our world from this crisis and efforts should be made that future generation will be able to save themselves from this kind of problem. Long term financial policy on national and international levels needs to be designed keeping in mind the safety aspects and interest of investors.

American Economy

The failure of Lehman Brothers and sale of Merrill Lynch clearly shows the picture of USA economy.

 

Recently US Govt. given bailout to AIG and overtaken Goldman Sachs and Morgan Stanley is now under the command of US administration.

 

It will create big unemployment in US and affect the whole world severely and if right steps are not taken by US government than definitely the whole world will face big slowdown as happened in 1930-40 when all world faced huge slowdown except Russia. This time it looks like that China will be able to beat the inflation while rest world is finding it difficult to save themselves from impact of slowdown in US economies.

 

Please present your views regarding same.

Indian Share Market

Yesterday BSE Sensex was down by 833 points closed at 16630 one another biggest fall in history of market. The much awaited Reliance Power IPO listed in NSE at a price of Rs. 530/- touched high of Rs. 590/- and rolled down in minutes and closed at Rs.373/-. The predicted price range for this share was Rs.600-900 but the listing price of Rs.530 sent a negative shock wave in investors. The whole market was down due to Global cues. Investment Experts suggest that investor should not book the looses and wait for the stability. It is expected that market will further move down between 14500 - 15300. In last week Real Estate firm Emaar MGF & Wockhardt Hospitals pulled back their IPO offering from the market due to poor response. Here i would like to mention that since the time Reliance Power IPO came into market all the major/reputed shares like ONGC, SBI, NTPC, RPL, RCom etc. are down due to slow down in USA economy (the biggest economy in the world) and other global cues. In next 3-4 month market will recover and so the Reliance Power will also recover.

Government will definitely complete its duties in the budget and look out that investors interested is protected.

Today I think market will open at move upward in starting sessions.

Lets Wait and Watch.

BSE Sensex

BSE Sensex

BSE Sensex (Bombay Stock Exchange sensitive Index) is one of the attractive options for investor where investor earn and loss heavily. It is the indicator of economy as its has made up of stocks of different sector companies. BSE Sensex has started from 100 point in 1979 and crossed 19000 marks recently. During its history, sensex has crossed many benchmarks but from 4000 point to 5000 points it has taken maximum time (approx. seven years) because of Harshad Mehta scam (a black name in sensex history). On an average sensex gives 9 per-cent returns.

Please post your views, ideas and remarks for above.