Selling pressure: Investors should wait before buying

Sherna D'Mello / TNN / Jan 19, 2008, 00:04 IST

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Investors ended the week with a huge loss in wealth of Rs 5.18 lakh crore.

Selling pressure: Investors should wait before buying

MUMBAI: Investors ended the week with a huge loss in wealth of Rs 5.18 lakh crore. While some market players say it's the IPO effect others say it's a weak global market that is dragging down the bourses. Majority say it's a combination of the two. The important question now is whether there is more pain in store for the markets or have they already bottomed out.
Market players say not yet, since there's likely to be a further correction, although not for much longer."Monday morning is likely to see some more selling pressure so it's not yet time to buy," said Arun Kejriwal, director, KRIS. "Even after that, buying should be stock-specific as all stocks are not likely to give great returns," he added.
"The selling is not likely to continue for more than a week," said Seshadri Bharatan of Dawnay Day AV Securities. "The put-call ratio in F&O segment is indicating some strength and I think the market has not yet bottomed out but is close to the bottom. Investors should wait and start buying mid-week," he added.
Monday might see a bounce back, as a statement from Fed chief Ben Bernanke calling for quick action on the issue of sub-prime loans is likely to boost US markets. But it may not be a long rally from there, and the markets may see another 5-8% correction before heading north again.

"Investors should keep booking profits since some segments like mid-caps have had a dream run over the last few months. If an investors has bough at a higher level and is now stuck, it's still not worth buying to average out the purchase cost," said Ambareesh Baliga, V-P, Karvy Stock Broking.

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