Not much hope for the markets today Analysis for Dec 19, 2011

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Analysis for Dec 19, 2011
The Indian markets opened in red today on negative cues from Asian markets. The Asian markets are trading low on negative cues from the European markets.

The 30-share Sensex fell sharply by 278 points to 15,213 during initial part of the trade and 50-share Nifty dipped by 87 points to 4,563.

Standard & Poor"s has downgraded the credit rating of Belgium and Fitch has downgraded the credit outlook of several European countries including France. This has increased the anxiety of market participants.

The US markets ended on a mixed note on Friday. Major European Markets ended in red on Friday as markets got no relief news on the Euro zone debt crisis front. Further downgrades of sovereign ratings by rating agencies may bust the European banking system and this is currently the biggest concern of the markets.

In a key FDI liberalization step, the government of India has permitted foreign investors to get equity in lieu of dividends. This may have some positive impact on the sentiments of the market, particularly of the FIIs. The market today may not reverse much of the losses of Friday, and it will be a really big relief if the Indian markets manage somehow to end the day in green.

On Friday, the BSE SENSEX closed at 15,491.35 down by 345.12 points or by 2.18 per cent and the NSE Nifty ended at 4,651.60, down by 94.75 points or by 2 per cent. The BSE MIDCAP was at 5,277.27 down by 92.34 points or by 1.72 per cent, while the BSE SMLCAP was at 5,688.39 down by 92.65 points or by 1.6 per cent. The BSE MIDCAP was at 5,277.27 down by 92.34 points or by 1.72 per cent while the BSE SMLCAP was at 5,688.39 down by 92.65 points or by 1.6 per cent.

The net investments by FIIs on 16th December, 2011 in Indian capital markets stood at Rs -216.20 crore. The net FII investments were negative on Friday.

The gross purchases by the FIIs in the Indian equity markets were of Rs. 3000.20 crore. The gross sales were of Rs.3227.20 crore. The net investment in the equity markets by FIIs on December 16th, 2011 stood at Rs – 226.60 crore.

The gross purchases by the FIIs in the Indian debt markets were of Rs 1657.30 crore. The gross sales by FIIs were of Rs 1646.90 crore. The net investment by the FIIs in the debt markets stood at Rs 10.40 crore.

Today, the Asian markets have opened in red on negative cues from the European markets. Standard & Poor"s has downgraded the credit rating of Belgium and Fitch has downgraded the credit outlook of several European countries including France. This has increased the anxiety of market participants. At 7.40 A.M. Indian time, the Nikkei 225 was down 69.39 points and was at 8332.98. The Hang Seng was down 291.89 points and was at 17996.91. The Taiwan weighted was down 92.59 points and was at 6692.52. The Shanghai composite was down 32.38 points and was at 2192.46.

The US markets ended on a mixed note on Friday. The markets didn"t respond too much to Fitch"s downgrade of Bank of America, Goldman Sachs etc. The Nasdaq closed at 2555.33, gaining 14.32 points over the previous day"s closing. The Dow Jones Industrial lost 2.42 points and closed at 11866.39. The S & P 500 gained 3.91 points and closed at 1219.66.

Major European Markets ended in red on Friday as markets got no relief news on the Euro zone debt crisis front. Further downgrades of Sovereign ratings by rating agencies may bust the European banking system and this is currently the biggest concern of the markets. The DAX lost 28.84 points and closed at 5701.78. The FTSE 100 lost 13.51 points and closed at 5387.34. The CAC was down 26.43 points and closed at 2972.30.

On Friday, gold prices ended gained 1.2 % to close at $1596.60 per ounce, while silver prices gained 1 % and closed at $ 29.55 per ounce. Crude oil gained 0.2% to close at $ 94.10 per barrel.

Dion Global Solutions Ltd

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