Thursday, May 24, 2007

Newsletter dated 24th May,2007

U.S. stocks edged lower on Wednesday as a warning about Chinese stocks by former Federal Reserve Chairman Alan Greenspan erased gains fueled by takeover talk in the aluminum sector. Greenspan said he feared a "dramatic contraction" in Chinese stocks after the recent boom, adding the run-up was "clearly unsustainable." The comments come almost three months after a sharp drop in Chinese stocks on concerns about speculative investments triggered a global equity rout.

There were some comments about the bubble in China and that reversed the market. The last big sell-off was China- driven, so Greenspan's comments got people to be a little bit more aggressive on the sell side. People are looking for a reason for the market to take a rest, but there are still some pretty strong money flow trends, with what is going on with private equity.

The Dow Jones industrial average <.DJI> fell 14.30 points, or 0.11 percent, to end at 13,525.65, after earlier hitting a record. The Standard & Poor's 500 Index <.SPX> slipped 1.84 points, or 0.12 percent, to finish at 1,522.28. The Nasdaq Composite Index <.IXIC> dropped 10.97 points, or 0.42 percent, to close at 2,577.05.

The Nikkei slipped 0.11 percent by the close of morning trade on Thursday, on track for its first loss in four sessions, as investors sold some recent gainers such as Sony Corp. after Alan Greenspan warned of a sell-off in Chinese stocks. Greenspan, the former chairman of the U.S. Federal Reserve, warned of a "dramatic contraction" in Chinese stocks, making investors nervous that other markets -- including Japan -- would be affected. The market advanced for three days straight ... so we were getting to a point where it was easy to take profits. Nikkei <.N225> finished the morning down 18.77 points at 17,686.35. The broad TOPIX index <.TOPX> lost 0.14 percent to 1,737.59. All other Asian market are trading in the red, though not very much.

Today Sensex might open in the red by 30-50 points. After that we might see some institutional buying in some selective counters. Today we might see range bound movement with stock specific movement. Mid-caps might correct some more before they again resume their upward journey. Today again technology stocks might underperform the markets following weak dollar.

TOP BUYS......

1. BAJAJ AUTO

2. SUN TV

3. TATA MOTORS (at lower levels)

4. ONGC (at lower levels)

5. Dr Reddys

6. VSNL


Note:-
1. Place Stop loss 3-4% below your cost price.
2. Do your own homework before trading.
3. Book profits if you get 2-4% return.

ANURAG DUJARI
Mobile - 09831909904, 09433988791, 09330911514, 09883059291
Messenger ID - anurag130
E-Mail - anurag130@yahoo.com

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