Sensex settles 284 points higher as banks, FMCG stocks rally


The benchmark indices settled higher on Friday taking cues from their Asian peers.

The S&P BSE Sensex ended at 37,948, up 284 points while the broader Nifty50 index settled at 11,471, up 86 points.

Among key stocks, the fast moving consumer goods (FMCG) major ITC rose over 2 per cent to end at Rs 313 levels on the BSE. The stock hit a fresh 52-week high of Rs 315 earlier today. ICICI Bank and State Bank of India also ended higher in a range of 1.8 to 3.0 per cent on the BSE.

Among sectors, the Nifty Pharma index ended higher for the fourth straight day, hitting an over six-month high on the National Stock Exchange (NSE). Sun Pharmaceutical Industries, Dr Reddy’s Laboratories, Glenmark Pharmaceuticals, Lupin, Aurobindo Pharma and Cadila Healthcare from the index, were up in the range of 1 per cent to 4 per cent on the NSE.

Shares of paper companies were trading higher on the bourses on expectations of a positive outlook for the current July-September quarter.

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How to use the Convergence Tool?


Introducing the Convergence Tool from StockArchitect

What is convergence?

In simple terms when different moving averages are in a range of 1%, convergence is said to have occurred. In the Convergence Tool, we are using 4, 9, 18, 50 and 200 DMA (daily moving average) to determine convergence.

After you have subscribed to the convergence tool (or during the 7 day free trial period as the case maybe), you will see this screen below:

As you can see we work on 4, 9, 18, 50 and 200 MA.

The “Within Range” column displays 2 values

  1. Yes which means a convergence of 5
  2. No (4) or No (3) which means convergence of 4 or 3 respectively.

How do I make use of the data displayed by the Convergence Tool?

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Reblog: Morningstar: Value Investing: Patience Will Be Rewarded


Here’s a great article from Morningstar which discusses the importance of patience as a value investor. One of the key takeaways is:

“However, by anchoring investment decisions to value, we can navigate challenging circumstances and look through market noise and emotion to identify and take advantage of opportunities that may present in times of market stress. This often sees our views as contrarian to others in the market.”

Here’s an excerpt from the article:

It is difficult to know how long it will take for an attractively priced asset to appreciate towards its fair value, long-term investors must be prepared to wait.

Value investing has a prominent place in our investment process and is backed up by a vast body of empirical evidence that supports this approach to investing.

Perhaps it can be best described through illustration in the diagram below:

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Sensex ends 155 pts lower; SBI down 4% post Q1 results


Benchmark indices ended lower on Friday, after touching record highs for four straight sessions, following global market trends. Metals, pharma and PSU banks were the top draggers during the day.

The S&P BSE Sensex ended the day at 37,869 down 155 while the Nifty50 index settled at 11,429 down 41 points

SBI slipped 4% after it reported a bigger-than-expected quarterly loss on Friday, as the country’s biggest lender by assets made higher provisions for treasury losses. SBI’s third consecutive quarterly net loss came in at Rs 48.76 billion ($707.28 million) for the three months to June 30, compared with a profit of Rs 20.06 billion a year ago, and a record loss of Rs 77.18 billion in the March quarter. Gross NPA stood at 10.69% vs 10.91% QoQ while provisions were at Rs 192.28 billion vs Rs 280.96 billion QoQ

Shares of Jet Airways hit a three-year low of Rs 262, down 10% on the BSE on Friday in early morning trade after the company deferred announcing their June quarter numbers to an unspecified date. On the National Stock Exchange (NSE), the stock hit a low of Rs 258, and is trading at its lowest level since June 16, 2015

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Reblog: 39 Powerful Trading Tips by Ed Seykota That Will Rock Your Trading


ed seykota

Heard of Ed Seykota?

He was featured in the book Market Wizards and returned 250,000% over a 16 year period. Comparable to the likes of Warren Buffet and George Soros.

A little background:

Ed Seykota has an Electrical Engineering degree from MIT and is a systematic trend follower.

His trading is largely confined to the few minutes it takes to run his computer program, which generates signals for the next day.

If you want to get into the mind of one the best traders around, this is your chance.

Here are the 39 best things said by Ed Seykota.

Quotes by Ed Seykota

Technical analysis

1. In order of importance to me are: (1) the long-term trend, (2) the current chart pattern, and (3) picking a good spot to buy or sell. Those are the three primary components of my trading. Way down in very distant fourth place are my fundamental ideas and, quite likely, on balance, they have cost me money.

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Reblog: IPO Review – CreditAccess Grameen


IPO Snapshot:

CreditAccess Grameen Limited is entering the primary market on Wednesday, August 8, 2018, to raise upto Rs. 630 crore via fresh issue of equity shares of Rs. 10 each and an offer for sale (OFS) of upto 1.19 crore equity shares by promoter, both in the price band of Rs. 418 to Rs. 422 per share. Representing 18.70% of the post issue paid-up share capital, total issue size is Rs. 1,131 crore at the upper end of the price band, of which 44% is the OFS portion. The issue closes on Friday, August 10, 2018 and listing is likely on 23rd August.

Company Overview:

CreditAccess Grameen is India’s 3rd largest micro finance institution (MFI) providing unsecured loans to women with annual household income upto Rs.1.6 lakh (urban area) and Rs. 1 lakh (rural area), of average ticket size of Rs. 20,000. With asset under management (AUM) of Rs. 4,975 crore (31-3-18) and a deep rural focus (81% customers in rural), 86% of loans provided is for income generating activities, 10% for home improvement and balance for emergency and family welfare. Despite widespread network of 516 branches across 132 districts in 9 Indian States and Union territory, company’s AUM is concentrated in Karnataka (58% of total) and Maharashtra (27%). While other MFIs have converted to banks (Bandhan, Equitas, Ujjivan, Bharat Financial on the verge of merger with Indusind), CreditAccess does not plan to tap the banking route and is comfortable being a standalone MFI.

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Reblog: The Drawbacks of Behavioral Finance During a Market Correction


The stock market got interesting again this week. Volatility is back after having gone missing for the past 18 months or so.I saw the following words spewed across the financial media this week: turbulence, fear, pain, panic, distress, agony. It’s still a little early for all of that. As of the close on Thursday, the S&P 500 is a little over 10% from its all-time highs.But try telling that to your emotions when you’re witnessing a decent percentage of your savings evaporate over the course of a little more than a week. The pain we feel from losses dwarfs the pleasure we feel from gains.

Because of the havoc they can wreak on our portfolios, investment professionals and advisors often instruct their clients to ignore their emotions during times like this.

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Sensex ends 391 pts higher led by financials, IMD forecast


The benchmark indices settled over 1 per cent higher on Friday after falling for two consecutive days, led by a rise in the financial stocks and a ‘normal’ monsoon forecast during August-September by the India Meteorological Department (IMD). They also rose taking cues from their Asian peers which inched higher following a tech-led rise on Wall Street.

The S&P BSE Sensex ended at 37,556, up 391 points while the broader Nifty50 index settled at 11,361, up 116 points.

Among sectoral indices, the Nifty Bank index rose 1.24 per cent led by a rise in the shares of Axis Bank, YES Bank and Punjab National Bank. The Nifty Fin Service index, too, settled 1.54 per cent higher led by Indiabulls Housing Finance and Edelweiss Financial Services.

Shares of VIP Industries have moved higher by 10% to Rs 538 per share, also their record high on the BSE, after the company reported a strong 55% year on year (yoy) jump in its consolidated net profit at Rs 634 million in June quarter (Q1FY19). The company, which is engaged in manufacturing and marketing of luggage and bags, had a profit of Rs 410 million in the same quarter year ago.

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Reblog: How to Tell a Stock Market Correction From a Crash


News that the Dow Jones Industrial Average is down several hundred points sends shivers down the spine of even the most weathered investor. Such drops, while infrequent, can be scary because it’s impossible to predict how severe or long-lasting losses will be. And even if you trust the market will eventually rebound (as it always has), it’s hard to watch the value of your investments shrink before your eyes.

In the immediate term, people will argue about what to call it — a crash? A correction? Leave the vernacular to others, and instead understand what’s causing the market to fall. This knowledge may not bring your money back right away, but it could help you prepare for the market’s next move up or take advantage of lower stock prices in the meantime.

Defining a drop in the stock market


Reblog : Warren Buffett – “It’s Not What You Look At That Matters; It’s What You See.”


Warren Buffett provides a great lesson for all investors in the book – The Warren Buffet Way, by Robert Hagstrom. The lesson is that investors can spend weeks and years reading and analyzing information on prospective companies, but according to Buffett, “It’s not what you look at that matters; it’s what you see.” The lesson learned by Buffett happened during his investigation of IBM back in 2011.

Here’s an excerpt from the book:

Buffett confessed that he came late to the IBM party. Like Coca-Cola in 1988 and Burlington Northern Santa-Fe in 2006, he had been reading the annual reports for 50 years before his epiphany. It arrived, he said, one Saturday in March 2011. Quoting Thoreau, Buffett says, “It’s not what you look at that matters; it ’s what you see.” Buffett admitted to CNBC that he had been “hit between the eyes” by the competitive advantages IBM possesses in finding and keeping clients.

The information technology (IT) services industry is a dynamic and global industry within the technology sector, and no one is bigger in this industry than IBM. Information technology is an $800 billion-plus market that covers a broad spectrum of services broken down into four different buckets: consulting, systems integration, IT outsourcing, and business process outsourcing.

The first two, combined, contribute 52 percent of IBM ’s revenues; 32 percent comes from IT outsourcing; and 16 percent from business process outsourcing. In the consulting and systems integration space, IBM is the number-one global provider—38 percent bigger than the next competitor, Accenture. In the IT outsourcing space, IBM is also the number-one global provider—78 percent larger than the next competitor, Hewlett-Packard. In business process outsourcing, IBM is the seventh-largest provider, behind Teleperformance, Atento, Convergys, Sitel, Aegis, and Genpact.

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