SUNNY SENSEX DAYS: HOW FAR AWAY

Sensex is below 16K after half a year, inflation crossed past the crucial 5%, Karat and party drawing attention with pre-election gimmick, UPA is in election mood handing over soaps and above all--- the fears of recession in USA is catching up. It is mesh in American job market, there is an unexpected drop of payroll. It is now in air that the total credits related write off will be in the range of $ 1 trillion. The economy massacre is now a global phenomenon initiated in North America.

But the fall of Indian Stock Market is hardest amongst peers.

The Sensex has lost 21% in 2008, but still the average price earning multiple of Sensex stocks is still at 21.58. China ranks over us theirs at 36.03 after a fall of 13.6% in 2008. In the same time Hang Seng dropped 16.5%, Kospi by 11.6% and Japan Nikkei by 5.8%.

The technical analysts are most worried lot, both the key indices Sensex and Nifty have crossed the crucial 50 week moving averages indicating an onset of bear phase of our market.

Why we are going down faster than other markets, probably due to more inflow of FII money to India compared to other markets last year. So money will head out in tough times. The more money came to our market as it presented a better earning potential.

The robust earning potential can not go wrong as drastically and at such a short time frame as our market is now presenting before us. So probably Indian stock market is more attractive now.

So it is a buy time for small investors! ! ! !

No, with another very strong NO.

Markets are mostly driven by sentiment. Right now the sentiments of investors are abysmally low; it does not appear to me that it will improve so fast at least in India. No sensible investors will go for market till political situation of left vs. others of UPA stabilizes.

Wait till appropriate time (Do not rush), have some money in pocket then go for a short term kill.