The best thing about the market is that when most people start thinking that the world is going to end, the market shows them how terribly they have gone wrong !
Market as expected started 2011 with a horrifying slide of almost 10%. Yesterday it touched 19,000 for a second and bounced sharply from that level.
Now what? Most people have given up on the market. Those who were bullish on "India Story" came complaining that there full 2010 year's gain have become half in just first 10 days of 2011...!!! They have increasingly become worried about the market and looking to come out at every rise...
Additionally, the IIP numbers released today has fuelled their belief of falling market... IIP for November came at a dismal 2.70% after the October at 10.80%. So, all the more reason to be bearish..! So, most "logical" action on this kind of news is to SELL - SELL - SELL.
But hey, after already a 10% fall from top, does that make sense? Who knows !
What I can say is that for a short term, it is a time to buy and specifically to buy many strong stocks, which otherwise you would not have got at this rate...Which are those?
To my mind, here goes the list:
CIPLA - A good pick between 340-350.
GAIL - If you get this at 495-505 levels, start accumulating
TCS - Good pick at 1080-1120 levels
Aurobindo Pharma, Hexaware, Hindustan Zinc are the stocks one should accumulate at a deeper cuts.
What happens Next? To my mind, at such bad news, when the weaker hands would book loss, the stronger hands would buy the stocks with a short term bounce to capture. Hopefully, we all would see 19,700-20,000 levels before the mid of next week.
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