More Sentimental than Fundamental…..

The government approved gamble, as my roommate calls it….These days, I see most logging into http://www.nse-india.com/ first when in office…and then discussions among themselves….Do they realize or not that the Stock market is driven by sentiments too… Is there any way by which sentiments can be influenced or rather created? There are five ways companies can boost prices of their stocks: By announcing a bonus issue, stock-split, preferential issue, qualified institutional placement (QIP), and fund raising through issue of GDRs or ADRs. Is there any more ways??

Though these corporate actions generate a lot of heat, the hype lasts only for a short term. Ultimately, it boils down to the financial track record of the company. Hence, what matters is the company business operations, management credentials and future outlook.

Breaking the stride is the circuit filters, which only postpones the inevitable, by controlling panic especially driven by sentiments, by not allowing the prices to move beyond a limit. It could be market-wide or on individual stocks. It is designed to keep a check on stock market manipulation and protect small investors. As trading is halted, it is difficult to know the real value of a stock. Besides volumes could witness a sudden rise as investors rush to execute their orders and before the anticipated trading halt....

Going forward you may read more of it..as I have been reading the Journal, Capital Market, books like Making money in the wall street, and browsing these sites myself these days....