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Charts & Analysis

Market Snapshot: Index P/E Goes Below 18

This week has killed the index, which fell 7.2% to go down just 3% above the last critical low of 4747.

Indian Market Snapshot

(Click for larger image)

It has been an incredible trend down, almost as steep as the way up.  Sectors for the week and month:

Sector Weekly Moves

Sector Month Moves November 2011

Altogether very destructive for the markets – and much more for realty, banks, metals and in general, midcaps. Realty stocks have now fallen 43% for 2011.

With a few hiccups and rallies I expect the overall trend to continue.

  • Shinu says:

    Hi Deepak
    Where can we track the PE for Sensex, Midcap and Smallcap and its history? Just curious enough as it seems it is closing in on the 2008 levels really fast. Would love to see your thoughts on the same.

  • On first trading day of 2011, Indian markets were trading at P/E of 23.5. A fall below the PE of 18, has made Indian markets cheaper by 24%. Though long term investors will still refer to it as a moderately overvalued market, fact remains that one should start looking at individual stocks. There are a few ‘amazingly’ cheap opportunities available in markets.
    At current levels, markets are trading 10% lower than the 200DMAs. And if one has carefully analysed the past trends, it is better to invest when overall markets are trading below their 200DMAs.

  • bemoneyaware says:

    Has the market bottomed out? No..I think there is more pain left..Just for reference what is the least PE of Nifty ? Did it happen in Oct 2008?

  • @bemoneyaware.
    Yes. It was 10.68 on 27th October 2008.