"It is too premature to say there is a definite bullish trend in the market," said Jagannadham Thunuguntla, head of the capital markets arm of India's fourth largest share brokerage firm, the Delhi-based SMC Group. "Just too much has happened in the last two months and investors are still shell-shocked and trying to understand the state of the global economy." He said although US markets surged Thursday, some key Asian markets have shed values Friday despite an interest rate cut Friday by the Japanese central bank to a near zero level of 0.3 percent from 0.5 percent earlier.

1. October 31, 2008
Indian equities surge, bounce back from bear excesses
Mumbai
After the bear market excesses of the last few weeks, Indian equities bounced back sharply Friday with a
key equities index closing with a gain of 743.55 points or 8.22 percent - the biggest single-day gain in
recent weeks.
Analysts said the bounce back was expected because after a bout of bear market excess as was
witnessed earlier this week with the key index going even below the 8,000 mark, some kind of recovery
was very much on the cards due to short covering.
Sentiment was also helped by the big upswing in the US markets a day earlier following the cut in the key
interest rate by the US Federal Reserve to 1 percent, the lowest in the modern era.
The last time the key interest rate was cut to 1 percent was in 2000 after the bursting of the dotcom
bubble, analysts said, adding that the rate cut was anyway expected over the last couple of weeks
because the US Fed really had no other alternative.
The benchmark 30-share sensitive index (Sensex) of the Bombay Stock Exchange (BSE) opened at
9,361.66 points, up 317.15 points or 3.51 percent against the previous close at 9,044.51 points, and soon
surged ahead to hit a high of 9,859.25 points.
Some two and a half hours into trading, the key index was ruling at 9,661.01 points, up 616.50 points or
6.82 percent over its previous close.
The situation was no different at the National Stock Exchange (NSE) where its broader 50-share S&P
CNX Nifty index was ruling at 2,847.25 points, up 150.2 points or 5.57 percent against its previous close
at 2,697.05 points.
The BSE midcap index was at 3,161.08, up 66.60 points or 2.15 percent from its previous close at
3,094.48 points.
The BSE smallcap index was at 3,756.84 points, up 82.23 points or 2.24 percent from its previous close
at 3,674.61 points.
Despite the upward rally, there is still little depth in the market as investors continue to be jittery,
especially now that the US Consumer Confidence Index announced Thursday has hit an all-time low,
analysts said.
The global financial problems were now definitely creeping into the real economy and it will take some
time before investors really come to grips with the situation, they said.
quot;It is too premature to say there is a definite bullish trend in the market,quot; said Jagannadham
Thunuguntla, head of the capital markets arm of India's fourth largest share brokerage firm, the Delhi-
based SMC Group.

2. quot;Just too much has happened in the last two months and investors are still shell-shocked and trying to
understand the state of the global economy.quot;
He said although US markets surged Thursday, some key Asian markets have shed values Friday
despite an interest rate cut Friday by the Japanese central bank to a near zero level of 0.3 percent from
0.5 percent earlier.
When Indian equities markets opened Friday morning, both the Nikkei, key index of the Tokyo Stock
Exchange and the Hang Seng, key index of the Hong Kong Stock Exchange, were down about 2 percent
each.
The Nikkei fell further during the day and closed 5.01 percent down while the Hang Seng was 5.05
percent down when reports last came in.
quot;So you can't say that the Indian markets are really following global cues,quot; Thunuguntla said, adding quot;the
Indian market bounce-back was expected as there have been bear excesses and the Sensex had even
gone into 7,000 levels Monday.quot;
quot;Bear excesses are always followed by a sharp bounce-back and there is certainly short covering but it is
far too early to say that bulls are back in business,quot; he said.
He also said that with the October series of futures and options ending Wednesday and a new series
beginning Friday, there could also be some position building, which could be helping the bounce-back.