STOCK MARKET OUTLOOK FOR 2010

STOCK MARKET OUTLOOK FOR 2010

Dr. B Amaranatha Sastry
FCA., ACS., MA(Astro)PhD.,


“WISH ALL THE VIEWERS A HAPPY AND PROSPEROUS NEW YEAR”

Indian stock market has witnessed tremendous rise in the last decade, thanks to the buoyant economic recovery on account of economic liberalization measures initiated by the PV Narasimha Rao Government in 1991. BSE Sensex has risen from 3972 at the beginning of 2001 to more than 17000 by the end of 2009 . Key drivers for growth in sensex are improving economic fundamentals evidenced by higher GDP growth and good corporate performance, huge FII investment due to their interest in emerging markets and also domestic growth and interest in capital market by HNIs , Mutual funds and retail investors.

Year Sensex % Growth

2001 3262 -18
2002 3377 4
2003 5839 73
2004 6603 13
2005 9398 42
2006 13787 47
2007 20287 47
2008 9737 -52
2009 17450 76

As can be seen from the above table , in the last 9 years, market has given negative return only in Two years and extraordinary returns in 2003 and 2009. Year 2008 is an aberration on account of slow down due to global recession and India also got impacted. With recovery in the fundamentals, economy has bounced back in 2009 and recovered most of the lost ground .

Stock market can be analysed from Three dimensions. 1. Fundametnal 2. Technical and 3. Astrological. Astrological analysis takes into account Investor sentiment , Market timing and impact of Geo political events. While Fundamental factors seem to be improving globally and more particularly in India due to higher domestic consumption, higher GDP growth etc., Technically, market seems to be heading for higher levels on account of too much liquidity (both Domestic and FII) and strong technical charts of Index and Index based heavy weights. Sensex EPS has risen from 272 in 2003 to 843 in 2009. Now let us analyse, how astrologically, market is poised to be in this new year 2010.

While generally, there is no special astrological significance for January 1 or for the calendar year 2010, transit position of planets is considered and general outlook is as under ::

Slowmoving planets Saturn continues to be in Virgo through out the year , Jupiter in Aquarius till 1.5.2010 and in Pisces there after to come back to Aquarius on 1.11.2010. Rahu and Ketu transit in Sagittarius and Gemini respectively. Mars moves slowly in Cancer till 25.5.2010 and thereafter moves from Leo till Sagittarius. On the basis of planetary position, aspects amongst slow moving planets and the constellations in which they are posited, following observations are made.

Rahu signifying FII investment and Jupiter signifying finance are favourably posited and more FII investment is expected to flow in which would generally improve the sentiment and market is expected to be generally better. Astrologically, Budget, expected to be presented on 28.2.2010, would give a boost to the stock market in view of the favourable planetary position.
General Trade and Commerce will improve and most sectors are expected to fare better.

However, there would be occasional corrections during the year and May Second half and July end are expected to witness more significant correction.
Important dates to consider as sensitive / trend change are 21.1.2010, 18.3.2010, 2.5.2010, 11.6.2010, 31.8.2010, 1.11.2010.
However, matter of concern during the year would be high rate of inflation as certain astrological combinations (nearness of lunar and solar months ) indicate high rate of inflation which would affect the common man severely. Consequences of high inflation would be a big negative factor for the economy and consequently stock maket too. Historically, low inflation and higher index and high inflation and lower index is a common phenomenon..
Agriculture related stocks, Pharma stocks , Iron and Steel stocks, Tea, Hotel and Shipping stocks, Electrical and Technology stocks, Chemical , Petroleum stocks, Infrastructure stocks, Mining related stocks , Finance and Bank stocks, PSU stocks are expected to generally do well during the year.
Market is expected to do better in First half compared to second half and there would be general growth during the year.


Technically, Nifty is expected to be Bullish above 5250 with resistance around 5425, 5600, 5880, 6340 , 6750 and weak below 5100 with supports around 4850, 4680, 4400, 3945, 3550 during the year.

In general, Next year economy is expected to record all round improvement, which would get reflected in Stockmarket too. In view of the high level of index, scrip specific movements would be more even within specific sectors also.