Udayan's View: Mkts could be volatile going forward

It’s the morning after all the mayhem. Yesterday saw the market touch lower circuit and a splendid recovery towards the end. Even now people seem to be in a shell-shocked state.

What are the implications and have we seen the worst of the implications of what came through yesterday? All of that is swirling around in the minds of market participants. So, it could be a bit volatile from here on but Wednesday’s comeback was quite remarkable.

Market on a festive day:

I don’t think yesterday will spill over too much to today’s trade; for one thing, I think the 18 months clarification helps a lot. I think going forward this changes the rules of the game a bit so things will get much more sticky in terms of flows from here so lets see how challenging it gets but I think none of the nervousness that we saw yesterday that I think we have left back.

Now people have had a night to sleep over it, they have analyzed what it could mean so now the reactions will not be knee jerk in nature, it could be prolonged if indeed flows dwindled but yesterday’s come back probably had holds out more for the bulls than for the bears.

So maybe not a run away rally and that would happen too but I think we probably consolidate and just see the market just for the day and for the next couple of days seems a bit indeterminate.

One does not know how the global guys will react I think after a circuit down whatever you say there is a lingering bit of suspicion about what the market will do next. This morning you ask market participants- they will say, it was good yesterday, the pullback but we just don’t know today.

So lets see the next couple of days and see how it’s going but I think we ended on a bullish note yesterday.

Asian Indices:

Let’s check out the global picture first and what’s happening. Yesterday all of that got missed out with what was happening with our own market. This morning things are a bit mixed but some markets are okay.

In China the Shanghai index is down 2.5 per cent, Hang Seng is up 0.75 per cent, Straits Times is down a bit, Taiwan is up a bit and Nikkie is sort of in between up just about 0.5 per cent mixed across Asia.

The debate rages on what impact the moves of yesterday could have on the market. The medium-term now that the near-term impact has softened with the reiteration of that 18 months window.