Over the weekend, China's official purchasing managers' index (PMI) came in at 49.8 for October, according to data from the National Bureau of Statistics (NBS), contracting for a third straight month. The market expectations was 50 .
Thus it is not only that China is slowing down , but the pace of slowdown is much faster than market expectations . Thus the financial market will have to keep playing catch up with the worsening situation in China.
Caixin final China purchasing managers' index (PMI) for October is expected to come in at 47.50 . This will be keenly watched by the market.
Job date from US is expected this week. This will be one of the key factors for Fed to decide on Dec interest rate decision . This if it comes better than expected market may sell off in anticipation of an interest rate hike in December .
We have seen a 7% drop in the share price of Vedanta on Friday . As we have mentioned in our previous reports metal stocks should be sold on any rise . We will not see any sustainable improvement in these counters till the time the situation on China improves . So far as the general market is concerned markets look weak and may open in the red.
News on Bihar pools will be keenly watched by the Indian market. A BJP victory may help to improve the market sentiments.
For the short term one may look at stocks like NTPC . Low coal prices help NTPC to keep improving its margins .
For the long term investor one can look at Dr Reddys.
We will come out with a portfolio for 2016 by early Jan.
We are also starting out technical analysis report from Jan 2016. The first four reports will be free for all those who sign up for ' Morning Tea' before 15th Nov .
We look forward to your suggestions ? Please let us know any specific stock or event which you want us to analyze in our reports ?