THE UNCERTAINTIES OF INDIAN STOCK MARKET

The most difficult problem faced by a day trader or a jobber in the Indian STOCK MARKET nowadays is the menace of algorithm trading. The moment you put a purchase or a sale bid of a particular rate, you get a parallel bid of the same rate at least 100 times the number of shares you have bid. Sometimes it is ten paisa lesser also. To trade in call & put options you need monumental patience, control over your frustration, obviously luck, & an ability to stare at the computer from 9.15 am to 3.30 p.m. In spite of being human, you have to have an eagle eye and be busy like a bee. 

Delivery based transactions have been a disaster in recent times. Gitanjali gems stock, favorite stock of bulls has been hammered from sub 650 levels to sub 60 levels in one month. This means erosion of the capital of about 90 per cent in one month. Another stock Wockpharma was butchered from 2100 level to 400 level in the same period. This stock happened to be the favorite of Foreign Institutional Investors.  Anybody will think twice before buying stocks in this market. I can name many stocks which fall in this category. SUZLON ENERGY, DLF, JP ASSOCIATES, GLOBAL TELE SYSTEMS, GTL INFRA, GMR INFRA, IVRCLINFRA, LOVABLE, BGR ENERGY, NMDC, ETC. THE LIST IS ENDLESS. The volatility factor is considerable. There are many openings which or either gap up or gap down. This results in the positional trader being trapped on a regular basis.

       The only sector that has outperformed the market have been pharma, fast moving consumer goods & information technology.  The rates of some stocks are at those level   ‎when the BSE Sensex was at 8000 level. Do not go by the present BSE or NIFTY index. They are both very misleading. The Banking sector stocks are also in the doldrums. Reliance & ADAG stocks have been under performer.   With elections about eight months away, the uncertainties are going to escalate in the near future. LET us keep our finger crossed.