DEALER’S DIARY 6th March 2012

Ansal Properties & Infrastructure Ltd sold 1.90 mln sq ft area for nearly 2.0 bln rupees in February, and 1.94 mln sq ft area for 2.4 bln rupees in January. Ansal Properties said realisations declined around 15% in February as the share of floor space index sales in total sales increased. However, in the 11 months ended Feb 29, realisations increased 10% to around 1,183 rupees a sq ft due to higher realisations in the residential segment. In the period,

Ansal Properties sold area worth 23.9 bln rupees, and payments from customers improved around 23%.

ICICI Bank, Bank of Baroda, Citicorp Finance India Ltd, and Life Insurance Corp of India today signed a memorandum of understanding to set up an infrastructure debt fund. The infrastructure debt fund will be structured as a nonbanking finance company. ICICI Bank, together with a wholly-owned subsidiary, will hold 31% stake in the

company, Bank of Baroda 30%, Citicorp Finance India Ltd 29%, and LIC 10%."The IDF (infrastructure debt fund) would seek to raise debt capital from domestic as well as foreign resources and would invest in infrastructure projects under the public-private partnership model that have completed one year of operations.

Promoter group company Tata International Ltd sold its entire 0.06% stake or 1.58 mln shares of Tata Motors Ltd on Mar 3. As of Dec 31, the total promoter holding in Tata Motors was at 35.04%.

The Reserve Bank of India said over-the-counter trades of certificates of deposit, and commercial papers must be settled according to procedures followed while reporting over-the-counter trades of corporate bonds. The settlements have to be done through the pooling accounts of the National Securities Clearing Corp Ltd, and Indian Clearing Corp Ltd.

Shares of Indraprastha Gas may rise Tuesday on news the company is hiking prices of compressed natural gas by 1.70-1.90 rupees/kg to offset the rise in natural gas cost.

Market Outlook Tuesday the 6th March 2012

The trend in domestic shares will hinge on the state election

result Tuesday, and a clear win for the Samajwadi Party in Uttar

Pradesh, as predicted by the exit polls, could further dampen

sentiment. In that case, the Samajwadi Party will not need

Congress' support to form a government in Uttar Pradesh, which

would imply that the latter could struggle to remain in control at

the Centre. Most exit polls have predicted Congress would come

fourth in the state. However, the exit polls can be misleading and

it will be prudent to wait for the final results. Shares of Anil

Ambani-promoted companies that ended up 2-6% could get a

further boost Tuesday if the election result favours the Samajwadi

Party. We see strong support for the Nifty at 5200 and do not

expect the index to slip below that mark. Resistance for Nifty is

seen at 5370 levels. Volatility may rise in the coming days as

market reacts to a spate of key events such as IIP and inflation

data, RBI's policy meet Union Budget and advance tax numbers

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Another myth busted: The year-end stock market rally

November 03, 2010 05:48 PM
Moneylife Digital Team

Source: http://www.moneylife.in/article/72/10898.html

As we head towards the end of the calendar year, whispers of a year-end rally in the stock markets are doing the rounds. But this is yet another myth

Among the many myths that are bandied around the investing world is the phenomenon of the 'year-end stock market rally'. The calendar year is coming to an end and that has brought with it the usual murmurs of an impending rally in the markets. If these are to be believed, the months of November and December are supposed to be extremely fruitful for equity investors, where they stand to make solid gains. If only it were that simple.
As with most other such notions, data doesn't support this. Unfortunately, very few people go back to test a notion with past data.

The truth is that you have as much of a chance of losing your money as making a fat buck during this period. As Mark Twain once said, "October: This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August and February."

Moneylife ran a study covering the performance of the Sensex over the two months of November and December, starting as far back as 1979. During this period of 31 years, we found that the Sensex has delivered gains on 18 such instances, while the index tanked on 13 occasions over the two months. This means that an investor has only a marginally better chance of achieving success based on this belief than going by the toss of a coin. A 58% probability of success is hardly a convincing argument in favour of the year-end rally.

Over all these years, the performance of the index during these months has been very volatile. The Sensex soared by 28% over November and December in the year 1993, when foreign investors had just started to nibble into Indian stocks.

Three years before that, in 1990, the index plunged 21% in this two-month period. On an average, the index has recorded gains of 4% on such occasions over all these years. That doesn't mean that the market will not go up over the next two months. But it will be for reasons other than the fact that these are great months for the market, historically.

Investors would be wise to be more sceptical about such beliefs and form their own opinion based on empirical evidence.