The situation in the morning was very alarming indeed. As news filtered out that Brexit would be a reality, panic spread across the Global markets.
Richard Partington of Bloomberg reported that there was mayhem and that people were shocked.
Mayhem this morning in the City this morning, where many people are shocked. Markets opening and falling.
— Richard Partington (@RJPartington) June 24, 2016
Blue Chip Bank stocks like RBS, Lloyds and Barclays lost huge chunks of their value:
RBS down 34%, Lloyds 28%, Barclays 30%. MASSIVE.
— Richard Partington (@RJPartington) June 24, 2016
Matthew Campbell, also of Bloomberg, reported that there was “carnage” across the Globe.
Carnage. Nothing but red. pic.twitter.com/6YAhyYQk4K
— Matthew Campbell (@MattCampbel) June 24, 2016
European stocks futures are plunging after #Brexit vote https://t.co/71imyP5wbl
Latest markets recap: https://t.co/rcfK7PmgWH
— Bloomberg (@business) June 24, 2016
The situation in the USA was no better with Wall Street also bracing in nervous anticipation for stocks to plunge:
U.S. futures indicate a low opening on Wall Street this morning as the markets react to the #Brexit vote. pic.twitter.com/k0GVNQVzGX
— FOX Business (@FoxBusiness) June 24, 2016
The situation at Dalal Street was also very challenging. Immediately on market opening, the Sensex effortlessly plunged 1000 points in the wake of several blue chips like Tata Motors, ICICI Bank, HDFC Bank etc shedding large parts of their valuation.
#Brexit effect: Sensex tanks 900 points, rupee crashes by 96 paise to crack 68-mark https://t.co/xYScxz2aK1https://t.co/aJaM5dNOkL
— Times of India (@timesofindia) June 24, 2016
Brexit bloodbath on D-St: Sensex plunges 1,000 pts; Nifty50 cracks below 8,000; Tata Motors tanks 12%. Live: https://t.co/TATVdCNebw
— ETMarkets (@ETMarkets) June 24, 2016
Fortunately, the Gurus had marshalled their resources well. They had anticipated that something drastic would happen and had begun preparing their followers with motivational tweets several hours in advance.
Porinju Veliyath was once again in the forefront. He kept a red alert throughout and was continuously monitoring the panic levels of his followers. He periodically shot off a barrage of inspiring tweets to convince his followers that Brexit would have no impact on the earnings of Indian companies and that they should stay invested.
Brexit from India in 1947 was cool 🙂 Why Indians get nervous if they exit EU? You guys expect corporate earning in India to decline?
— Porinju Veliyath (@porinju) June 24, 2016
Brexit is major global political event with zero net long term economic impact on India. Volatility simply means too many monkeys around!
— Porinju Veliyath (@porinju) June 24, 2016
Samir Arora, the whiz-kid fund manager who has a busy schedule, also rose to the occasion. He was also maintaining a 24×7 vigil on the situation. When he felt the the circumstances were getting grim, he cracked jokes to dissolve some of the tension.
Yeh Rexit phir Brexit- kya matlab hai.
Koi shareef aadmi aaram se chutti par bhi nahin ja sakta.— Samir Arora (@Iamsamirarora) June 24, 2016
Raamdeo Agrawal is camping far away from Dalal Street. In fact, he is thousands of miles away at Moscow. However, even he reached out from there to comfort novice investors that the World would not come to a grinding halt due to Brexit.
Ramdev Agarwal of @MotilalOswalLtd: Saw ET NOW in Moscow & called my manager to inquire cash levels. Great day to buy..See How biggies think
— Ajaya Sharma (@Ajaya_buddy) June 24, 2016
Raamdeo Agrawal also confidently declared that “Today is the day for shopping”. He reminded his fans that “the market meltdown offers opportunity to pick up more of the stocks on your list at a lesser price”.
Basant Maheshwari also chipped in with some words of advice.
The more you talk about an event – the less likely it's actual fallout on stock prices. #TheThoughtfulInvestor #Brexit
— Basant Maheshwari (@BMTheEquityDesk) June 23, 2016
Vijay Kedia also rushed to counsel investors that Brexit concerns foreign markets and that it will not have much impact on Indian stocks.
On a lighter note: We Indians are very generous. Instead of celebrating our own birthday, we tend to mourn over others funeral.#Brexit ????
— Vijay Kedia (@VijayKedia1) June 24, 2016
Of course, Vijay Kedia has reason to be pleased because Astec Lifescienes, his favourite micro-cap blue chip stock continued to surge in double digits. I reported yesterday that the relentless surge in the stock price indicates that some corporate action is on the anvil.
The concerted effort by the Gurus had a salutary effect on novice investors. One could see this clearly at Dalal Street, the nerve center of Mumbai. While the investors were nervous and edgy, they did not have the haunted look on their face. This was in sharp contrast with what we had seen during the carnage of February 2016. At that stage, the novice investors had abandoned all hope and were desperately dumping their stocks for the little they could recover.
In fact, some novice investors got very inspired by the advice of the Gurus and started exploring opportunities to buy:
Like this panic selloff.This s d time 1 understands d meaning of CASH, IMPORTANCE of 20% CAGR & DIVIDEND.Cmmon folks whats in ur buy list?
— Dibyajit Saha (@dibya_shareBuzz) June 24, 2016
Fortunately, by the EOD, the storm had blown. The Sensex staged a smart recovery and everyone heaved a sigh of relief:
Nifty almost above 8100, market at days high
— Ajaya Sharma (@Ajaya_buddy) June 24, 2016
The S&P BSE Sensex lost 604 pts, or 2.2%, while Nifty50 declined 182 pts. Tune into #MarketsWrap w/ @AyeshaFaridi1.https://t.co/sJJ3E9x8cW
— ET NOW (@ETNOWlive) June 24, 2016
The Gurus trudged back home, weary, but with a satisfied smile on their faces that their efforts had borne fruit!
these people have small caps some of which are low quality … so whats they supposed to on such days ?
Indeed I shopped around quite a bit when the sensex was down 1,000 points.
Never go by the advise of anybody,nobody is a master in stock markets. if markets were so attractive yesterday why Porinju or any of these self proclaimed gurus did not do any bulk deals ???why they have not made purchases ????? Try to understand the impact of Brexit and then take your own call , the currency market in the world is much bigger than any equity markets , China is just waiting patiently to see the impact of Brexit on global currencies and may go ahead shortly to devalue its own currency which will have major impact on global markets once again , so guys don’t be in a hurry to pull out your shopping bags coz Porinju said so …..Be wise
there is no right or wrong time, i felt there is some benefit maybe even of 5-10% in pricing of the stocks and have some cashpile to invest then why not
next 3-6 months markets will smoothen, ups and downs will keep coming, we should not be affected by these measures.
Even if these impact come we still live and manage the situation then why not this.
I too made some purchases, let’s see how it goes. Didn’t buy Tata motors though seems it will still come down.
Market will start zooming again from Monday as the worst is over. All money driven out of UK markets will come to fastest growing economy India and will zoom the sensex. Expect 30000 by end of year. Invest almost everything in shares. This is right time.
#Niveza #Review ::
Britain exit was an unpredictable event for any market expert. Earlier everything was in favor of exit but last week were tending towards stay. There were good opportunities for short term as well as long term investors. If there could have been stay, focus must be on profit booking. But as the Exit came in the picture, good buying has been seen and that really was the best strategy. One who might have bought in the opening hour of Indian market, must have gained better returns in two days only and returns are still counting. This was really an opportunity more than a fear.
Source:: http://goo.gl/aQaO0r