Chennai: Last October, investors witnessed two of the biggest falls in the history of sensex — both on Fridays. But a Friday isn't all about fall. Did you know the index's best 'average daily gains' actually come on the last day of the trading week? Data shows that average daily returns for sensex is not only the highest on Fridays but nearly two to four times more than on days such as Tuesday, Thursday or even Monday. This is based on an analysis of daily gains (in percentage terms) since September 1, 2003 when sensex was first calculated on freefloat market capitalisation method. In fact, when it comes to the top 30 daily gains for the 30-share benchmark in the last five years, Friday features the highest number of times (7), that is nearly 1 out of 4 occurrences. So, what drives this Friday effect? "(This) data is driven by levels of market activity rather than anything else i.e. trading volumes tend to be higher in the second half of the week (Wed-Fri) and that results in more deals being closed on such days. Brokerages like to close trades before the week ends because if they wait for the following week the trade sometimes gets away," said Saurabh Mukherjea, India head of Noble Group, a British investment bank. Experienced market participants have had memorable Fridays. Sensex gained over 1,100 points on January 25, 2008, another 750 points on October 31, 2008 and a half a dozen of occurrences when sensex rose 400-puls points in the last four years. Average daily returns for sensex on Friday are the highest at 0.20%, followed by Wednesday (0.12%), Tuesday (0.11%), Monday (0.06%) and Thursday comes last returning a mere (0.05%), data shows. Thursday's performance has not surprised market experts. In last 4 years, investors have seen sensex lose between 400-800 points on at least 10 occasions on a Thursday. "One of the reasons that can be attributed to lower returns on Thursday can be impact of F&O Expiry which is normally on the last Thursday on the month," said Chetan Majithia, head (Equities) at Crisil. * Sensex to touch 50,000 in 7 yrs: Morgan Stanley
*Chennai: Morgan Stanley on Thursday said that sensex could touch 50,000 mark in seven years from current levels, if the assumptions made are optimistic. "One way of looking at market valuations is to find out the number of years it could take the market to reach a certain level. In our base case, using our residual income model, the BSE sensex (used as a market proxy) could take about nine years to breach 50,000 from its current level. If the assumptions are made optimistic, the period to 50K shrinks to seven years," analysts Ridham Desai and Sheela Rathi said on Thursday. TNN --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en -~----------~----~----~----~------~----~------~--~---
