Be cautious, watch out for global cues2008-01-21 18:44:30 Source : CNBC-TV18

By Nimesh Shah, CNBC-TV18

In the last half an hour of trade, there was a bit of nibbling by local funds. But that is not enough for the markets to pullback sharply. In fact, there is selling pressure across the board from FIIs, local funds and HNIs.

In fact, there is a point when the domestic brokerages had to give a margin call across all the retail investors. That was the reason why there was panic selling in the Indian market.

There could be a bit of pressure going on because there is still margin pressure. A lot of terminals may not be able to trade tomorrow. So, one should watch out for the cues.

We need to watch out how Asia opens. That would give a cue how trade will pan out. But, at least, on the floor the feedback from the dealers was that there was selling pressure across the board, with FIIs, domestic funds, HNIs or retail investors.

This should go as one of the bad days because HNIs, in retail, have got a very big cut in their portfolio today. In fact, because of margin pressures, nearly 70% of their overleveraged positions in the F&O market was squared off forcefully, by the brokers in today’s structure.

This will go as a very bad day for the markets, as far as the further cues are concerned. The dealers are still not encouraging people to buy because there is global concern. There is a lot of domestic liquidity concerns because domestic liquidity is expected to bounce back well in the next couple of days. So, till then be a little cautious. One needs to watch out for the global cues very closely because that is where the entire pain started in the last few days.