Markets to remain range bound today ahead of FOMC meeting:

Goood morning to u all......Though the same CD is being played in almost all media channels and Financial Websites, regarding the rise of interest rates in the next FOMC meeting in US, I have a strong opinon that such news are used only to kill time and space. There will not be any rise in interest rates in the next FOMC meeting with the Crude prices nosediving towards Rs.50-Rs.55 levels and the US Commerce Department saying that America's deficit in the broadest measure of foreign trade increased in the spring to the second highest level in history, reflecting a big jump in payments for foreign oil. The current account deficit rose to $218.4 billion in the April-June quarter, an increase of 2.4 % over the deficit the first three months of the year. Since the oil prices are receding hence this deficit instead of widening should now move in the opposite direction. Hence where is the threat??!! The current account is the broadest measure of foreign trade because it covers not only trade in goods and services but also investment flows between countries. The deficit represents the amount the United States must borrow from foreigners to cover the shortfall between exports and imports.

Yesterday my recommended picks did excellently well. Pritish Nandy Communications Ltd recommended at Rs.42 last month (Please see the previous positings in this blog and the Yahoo Group SumanSpeaks) rose almost 20%. Cosmo Films also recommended last month also did well initially before settling at Rs.96.30 ( book partial profits in this counter).

SAI SERVICE STATION LTD Recommended Yesterday at around Rs.110 whizzed away to close at Rs.126 (a jump of more than 15%). Amforge Industries Ltd recommended as a speculative buy also hit the Buyer Freeze (please note that this is a speculative buy and should not be held for too long period).

Yesterday, The market-breadth was positive. However, it had weakened in the course of trading. Against 1,287 shares that rose on BSE, 1,208 declined. As many as 81 shares were unchanged. Gainers outpaced losers by a ratio of 1.06:1. In early trade, the advance-decline ratio was over 3:1, but slipped to 1.45:1 by 12:30 IST. The BSE Small-Cap Index rose 46.91 points (0.78%), to settle at 6,032.54. The BSE Mid-Cap Index gained 24.07 points (0.48%), to end at 5,059.19. The BSE clocked a turnover of Rs 2,878 crore, lower than Friday (15 September)’s Rs 3,456 crore.

The latest data showed that FIIs have purchased equities worth a net Rs 1,011 crore on 13 and 14 September 2006. Their inflow for September 2006, till 14 September, aggregates Rs 2,476 crore.

The near term major trigger for Global Markets is the US Federal Reserve’s meeting on Wednesday (20 September). The Fed is widely expected to keep interest rates steady at its policy meeting on Wednesday, as it did at its last meeting on 8 August,2006; when it paused the rate-hike campaign after two years. Analysts will closely watch the accompanying statement to gauge the future direction of interest rates

But for the domestic bourses, the next major trigger is Q2 September 2006 results. The results will start trickling in from early October 2006. Market men expect strong Q2 results from India Inc. Exit from all the metal shares as possible price reduction looms large in domestic markets, following a recent fall in global metal prices.

Yesterday, Housing finance firms were in demand on expectation of continued strong demand for home loans. HDFC gained 2.9% to Rs 1,370, Dewan Housing Finance rose 20% to Rs 78.90, and GIC Housing Finance gained 10.7% to Rs 45.90. Among these, Dewan Housing Finance rose on a huge volume of 34.3 lakh shares. Engineering and construction major L&T gained nearly 2% to Rs 2,689.90. The stock advanced for the second day as investors mopped up the scrip ahead of the record date for a bonus issue. The company will allot bonus shares on 29th September, 2006.

Volume Jump: Many shares on both the BSE and NSE showed increased volume..... The three shares which attracted my interest were: 1. Escorts jumped 11.7% to Rs 121.55. The stock rose on a huge volume of 83 lakh shares on BSE. 2. Dena Bank jumped nearly 16% to Rs 33.15. The scrip rose on a massive 48.5 lakh shares, which changed hands, on BSE. 3. Finolex Industries jumped 7.4% to Rs 99.15. The scrip rose on a stupendous volume of 34.8 lakh shares on BSE. [With inputs from the Internet]

I might be recommending some scrips at around 12 noon today as usual after monitoring the market movements. These days as mentioned earlier I am not getting time to recommend and play in the markets, due to severe tight schedule and deteorating heath conditions. I hope u will bear with me .......Special thanks to all those who are regularly contributing to Yahoo Group---SumanSpeaks.

More in the following mails.......

Best wishes,

Suman Mukherjee

India.

www.bcozindia.com