Why Nifty Tanked 130 Points today

1. Overnight interest rates in the U.S. have been near zero since December 2008 when the Fed initiated its bond buying programme. As a result of this ultra-low interest rate regime and abundant liquidity, money has flown out from the U.S. to emerging countries like India, where interest rates are comparatively higher. Foreign institutional investors (FIIs) have pumped almost $14 billion into India so far this year and $22.2 billion last year.
2. The Fed is now contemplating to reverse its policy because the U.S. economy seems to be coming back on tracks. Any tapering of bond-buying by the Fed could mean interest rates in the U.S. could start rising and money will flow back to government debt bonds in the U.S.
3. Fearing a reversal in the Fed policy, FIIs have turned sellers. FIIs have sold equities totalling over Rs. 4,000 crore over the last seven sessions. FIIs have sold Indian debt totalling $4.7 billion in 18 consecutive sessions.
4. A reversal of portfolio flows results in falling equity prices. Since May 22, the BSE Sensex is down nearly 6 per cent, while the Nifty has broken the 5,700 mark.
5. The withdrawal of funds has hit the rupee hardest because India runs a large current account deficit (the difference between inflows and outflows). Conversely, a weak rupee makes investment in Indian stocks unattractive.
6. Corporates with unhedged forex exposure could suffer increased losses as the rupee inches lower. This will further weaken investor sentiments.
7. Outflows from equity and debt markets raise concerns about financing of the current account deficit. An estimated $90 billion is required to fund the gap in India's balance of payments (export minus imports) in the current financial year.
8. Asset price volatility and a slowdown in capital inflows would hurt investment, as uncertainty further delays a revival of the capex cycle, global investment bank Nomura says.
9. The Reserve Bank of India, which has warned of upward risks to inflation on account of the rupee weakness, may be forced to hold on to its rates. This will further hurt stock markets. All this would delay India's GDP growth, which hit a decade low in the last fiscal.
10. The only positive from the Fed's reversal will be a fall in commodity prices, including gold, which will also help bring down high current account deficit.

Adding Selected Realty Shares In Portfolio

After booking profit in TGBL and Cairn India now I am using my cash reserve in portfolio to buy selected fundamentally strong realty stocks at attractive valuations.Already have Rs.84344in portfolio as reserve and 5 stocks in holdings.Initially started portfolio with Rs.100000.
Now adding DLF(203),JP associates(66) and Sobha Developers(390) and Oberoi Realty(235) all with equal weightage of 10% in portfolio worth Rs.40375 purchase.So my cash reserve will be reduced to Rs.43969.This is biggest addition to my trading portfolio in recent times

I expect ahead of upcoming monetary policy by RBI on june good realty shares will continue uptrend. Most probably this time there will be a cut in CRR and Repo too.So this is right time to pick trading bets

SCRIP	BUY RATE	BUY QTY	SECTOR	WEIGHTAGE	CMP	CURRENT VALUE
STRIDES ARCOLAB	800	6	PHARMA	5%	887	5322
BAJAJ FINSERV	890	6	NBFC	5%	667	4002
JAI CORP	85	117	REALTY	10%	60	7020
DCB	50	200	BANKING	10%	45	9000
RELCAPITAL	400	25	NBFC	10%	342	8550
DLF	203	50	REALTY	10%	203	10150
JP ASSOCIATES	66	150	REALTY	10%	66	9900
SOBHA	390	25	REALTY	10%	390	9750
OBEROI	235	45	REALTY	10%	235	10575
					HOLDINGS	74269
					RESERVE	43969
					PORTFOLIO	118238

Buy JM Financials For Longterm

JM Financial is an integrated financial services group, offering a wide range of services to a significant clientele that includes corporations, financial institutions, high net-worth individuals and retail investors.

The Group has interests in investment banking, institutional equity sales, trading, research and broking, private and corporate wealth management, equity broking, portfolio management, asset management, commodity broking, NBFC (Non Banking Finance Company) activities, private equity and asset reconstruction. While each of these businesses is independent in itself, they share the Group’s belief of trust being the most important factor for the organisation. The values of integrity, teamwork, innovation, performance and partnership shape the corporate vision and drive it to its purpose. 

Former Citigroup Chief Executive Vikram Pandit is buying a stake in financial services company JM Financial Ltd, JM Financial said in a statement on Thursday.

Pandit, who resigned from Citi last October, will also become non-executive chairman of JM Financial's banking arm if it succeeds in getting a banking license, the company said.

India is in the process of issuing new bank licences for the first time since 2004, and numerous companies are expected to apply. Pandit will have the right to buy shares in the proposed bank.

JM Financial said it would expand its lending and financing businesses by issuing $100 million in capital to funds raised and managed by a firm led by Pandit.

JM Financial, one of India's largest domestic financial firms, also said it would set up a fund jointly with Pandit's firm to buy distressed assets. The fund is targeting an initial capitalisation of $100 million.

Pandit said he had known JM Financial for more than two decades. "Given the opportunity, JM Financial can provide the banking and financial services that the country needs," he said in JM Financial's statement.

Pandit and his business partner, Hari Aiyer, will buy a 3 percent equity stake in the financial services company through an issue of warrants, the Indian company said. JM Financial has a market capitalisation of Rs.2000 crore
Currently JM Financial is trading at Rs.23 with PE ratio of approx 35.In regards to Vikram Pandit stake buy I assign a long term bullish view on the company with a target of 50 plus

ADD HEXAWARE IN MODEL PORTFOLIO

Add Hexaware in Core Portfolio
Hexaware is Indian mid sized IT company with a approx market cap of Rs.2500 crores.They have expertise in Enterprise solution,Infrastructure Management Services and exposure to Banking and Financial Service,Asset Management and Capital Market,Insurance Service,Healthcare and Life Science etc

The promoters currently holds 32% stakes and FII holds nearly 42% stakes in the company as per January-March quarter.More over Hexaware is Zero debt company.

Hexawares  consolidated income rose by 16 per cent to Rs 507.68 crore in the January-March quarter of 2013, from Rs 438.29 crore in the same quarter of 2012.The global headcount was 8,670 by the end of March 2013.

For the entire 2012 — the firm follows January-December fiscal — Hexaware had a net profit of Rs 327.64 crore, and revenue of Rs 1,948.17 crore.

Hexaware Technologies, a leading player in IT, BPO and consulting services  announced that it has secured a large contract worth potentially $177 million over a five-year term.

Hexaware has been associated with this leading U.S.-headquartered multinational company for several years. Through this contract, the company has a potential $100 million worth incremental business while extending existing business worth another $77 million over the course of the five year agreement. While it is an existing customer for Hexaware, this client also is a leading business process outsourcing client for Caliber Point Business Solutions, a 100 per cent wholly owned subsidiary of Hexaware.

At  current rate of Rs.80 the stock is trading at PE ratio of 8 with a fair valuation.So I initiate a buy call on Hexaware with a target of 120-130 range in next one year

Booking Profit in Cairn and Tata Global

My recent buying in Trading portfolio is doing good now.Bought 35 Cairn @ 290 in 5/3/2013 and 80 shares of TGBL @ 130.Now selling both scrips at 310 and 150 respectively.So just booking Rs.700 in Cairn and Rs.1600 in TGBL as market is around 6000
Now I have 10850+12000 and old cash reserve of 61484.So latest cash reserve is Rs.84334
For old details of trading portfolio check here http://keralatraders.blogspot.in/2013/03/holdings-in-trading-portfolio.html

SCRIP	BUY RATE	BUY QTY	SECTOR	WEIGHTAGE	CMP	CURRENT VALUE
STRIDES ARCOLAB	800	6	PHARMA	5%	865	5190
BAJAJ FINSERV	890	6	NBFC	5%	770	4620
JAI CORP	85	117	REALTY	10%	65	7605
DCB	50	200	BANKING	10%	47	9400
RELCAPITAL	400	25	NBFC	10%	365	9125
					TOTAL VALUE	35940
					RESERVE	84334
					TOTAL	120274

Latest Portfolio of Ace Investor Rakesh Jhunjunwala

The top three picks remained as Titan Industries with approx value of Rs.1573 crores,Lupin with Rs.640 crores and Crisil with Rs.490 crores as per today's market price. Tata groups fertiliser and chemical company  Rallis India is worth Rs.242 crores in his portfolio
There are some more investments in small caps like adinath exim,alphageo,provogue etc by RJ.It will be updated soon after their Q4 result announcing