Indian Markets Make Fascinating Bull Charge in Late Trade

Oh what a spectacular bull run in second half of trade! It was a secular bull charge, making almost every sector green in its wake.

Indian markets were flat to negative till 1 PM. And then, as if sparked by some tremendous news, got lifted magically. Nifty gained 116 points by close.

Not just Indian markets, Asian markets also got lifted and European markets are a sea of green as of now. Dow Jones Futures is indicating that US markets will open in firm green territory.

So what is cheering the entire global market so strongly? Dollar Index is slightly down, and Oil is slightly up as of publishing this post. I do not know of anything extraordinary that has happened or is expected to happen in global scenario which warrants this kind of bull run across all equity markets around the world.

If you know the reason of such positive action in markets, please feel free to share your thoughts with all of us. You can put your thoughts in the comments section of this post for the benefit of all of us. I will really appreciate that.

Return Our Money Now - Track Down Stressed Assets of Banks

Banks have indiscriminately given loans to high and mighty without proper due diligence and adequate collaterals. These  loans have become stressed assets in the books of banks and has created this abnormal situation when Govt is considering recapitalizing the banks.

This means that more tax payers' money is being proposed to be pumped into banks. For that Bank Board Bureau has been constituted which I had mentioned in my previous post.

Today total stressed assets of PSU banks stand at Rs 4 lakh crores. But it is estimated that if we also consider loans that face the risk of being declared NPAs going forward, then the total value of stressed assets of banks will stand at Rs 8 lakh crores. What a royal mess!!

This is our hard earned money which the banks are giving away to robbers masquerading as corporate entities. It is time we demand our money back into bank coffers. Instead of doing that, financial wizards like RBI Gov are devising ways to recapitalize banks. This means that more tax payers' money will be garnered and given to banks so that they can facilitate more robbers to rob us. What irony!

Before recapitalizing the banks we want the list of willful defaulters to be made public. But our RBI Gov insists that we should not name and shame these defaulting entities. Mr Raghuram Rajan, if you are not even willing to name these defaulters who have looted the Indian economy, then one wonders what action you will take against them!

We want government to track down stressed assets of banks, seize all assets of defaulters including their personal assets, and return our money back into the vaults of banks. For doing that, if you need to create a separate Public Asset Recovery Company by an Act of Parliament, do so. We simply need our money back now!

Bank Board Bureau Constituted - Will It Be Panacea For Ailing Banking Sector?

Bank Board Bureau (BBB) has been constituted by the Govt headed by former CAG head Mr Vinod Rai. BBB held its first meeting in Mumbai on 08 Apr 2016.

BBB consists of  chairman, three ex-officio members and three experts. In its first meeting BBB discussed the following :-

1. Board level vacancies of Banks and ways to fill them.
2. How to better recognize the stressed assets and solve them. 
3. Strategies to re-capitalize banks.
4. How to make banks more competitive in the changing financial landscape. 

It is noble for Govt to recognize the need to address the ills that has crippled the banking sector. But will BBB deliver if you have the same old people in its board who created the ill in the first place? Ex MDs and CMDs of banks are in board who in their tenure have created this mess. Moreover ex-officio members have to be from outside the financial agencies, since these very agencies had looked the other way while the NPA mess was being created.

One important aspect that must be included in the agenda of BBB is the means of recovery of bad loans and fixing responsibility of bank officials and regulatory bodies for allowing creation of these stressed assets over such a long time.

After all, we as tax payers need our money back from defaulting and fraud entities masquerading as industrialists. And we need it NOW, without anymore delaying tactics. Should we allow corporate houses of dubious credentials to rob us just like that? Is BBB listening?

Midcaps Outperform But Nifty Flat - Is It Signal For Sell Off?

Some things are not adding up in Indian markets. Markets are flat with almost a negative bias. Yet the midcaps are performing well. That does not portend well.

Throughout the trading session there was a sense of indecisiveness in indices. Little gains accrued during continued buying in the first half of trading was sold into in the later half. Tug-of-war between bulls and bears was there for all to see, with no clear winner. As a result indices ended absolutely flat.

But the good news is that midcaps performed well and ended the day with some decent gains. That would come as relief for traders in that genre.

Only point of concern is that midcaps are generally the last to rally in a bull run. Does that mean we are at  the end of a bull run starting from 6900 to 7700 in Nifty? That will surely be the case if Nifty does not close near 7700 in next 2/3 trading sessions.

Now let us update the status of 19 long positions that we are holding :-

TATAPOWER : Bought at 62.5, Closed at 65.9
JINDALSTEL : Bought at 62.5, Closed at 66.75

INDIACEM: Bought 87, Closed 91.8
RPOWER: Bought 50, Closed 49.4
IOB : Bought 30,Closed 29.45

ALBK: Bought 57,Closed 54.25

IDBI: Bought 71,Closed 67.1

PNB: Bought 87,Closed 81.85

SBI: Bought 195,Closed 184.25
UCOBANK: Bought 40,Closed 38.25
CANBK: Bought 194,Closed 183

KTKBANK: Bought 104,Closed 103.9

SYNDIBANK: Bought 67,Closed 66.6

BANKINDIA: Bought 98,Closed 91.2

ORIENTBANK: Bought 94,Closed 87.3
UNIONBANK: Bought 134,Closed 125.8
ANDHRABANK : Bought at 53, Closed at 51.95

HEXAWARE :  Bought at 268, Closed at 248.65

BANKBARODA : Bought at 150, Closed at 143.95

Profit Booking Continues - RBI Wants Banks Cleaned

Another bout of profit booking was witnessed in Indian markets. Serious damage was being inflicted on scrips in a secular manner. Traders on the long side had no place to hide.

What can be said of Raghuram Rajan, our RBI Governor of immense knowledge and experience!! He claims that he wants to restore the health of the banking sector.

Imagine after the banks have incurred loss of $ 120 billion in bad and troubled loans, today he wakes up and gives a clarion call for clean up drive in Indian Bank? Bah!!

What was Raghuram Rajan doing in his entire tenure when the banks were splurging away tax payers money in bad loans with little or no collateral? As a watchdog of Banking sector, why was RBI snoring till date? No red-flagging, no regulatory action - just free for all. In such scenario do we need a regulatory behemoth named RBI or just our finance ministry coupled with a mint should suffice? Point to ponder!

Anyway the status of our long positions are as under :-

CANBK : Bought at 194, Closed at 181.5
JINDALSTEL : Bought at 62.5, Closed at 60.15
INDIACEM : Bought at 87, Closed at 87.
RPOWER : Bought at 50, Closed at 48.75
IOB : Bought at 30, Closed at 29.1

UNIONBANK : Bought at 134, Closed at 125

ANDHRABANK : Bought at 53, Closed at 50.95

BANKINDIA : Bought at 98, Closed at 90.95

ORIENTBANK : Bought at 94, Closed at 86

SYNDIBANK : Bought at 67, Closed at 66.05

HEXAWARE :  Bought at 268, Closed at 251.5

BANKBARODA : Bought at 150, Closed at 143.4

KTKBANK   :  Bought at 104, Closed at 101.9

UCOBANK  :  Bought at 40, Closed at 37.55

ALBK    :  Bought at 57, Closed at 52.95

IDBI      :  Bought at 71, Closed at 67.4

PNB       : Bought at 87, Closed at 80.9

SBI    :  Bought at 195, Closed at 182.8

Today Tatapower entered our recommended buy price and was bought at 64. Tatapower closed at 64.1