Market to rally on strong global cues

Market is expected to rally today, 7 December 2007, following strong cues from global markets. The Sensex struck 20,000 mark yesterday, 6 December in early trade but was not able to sustain at higher levels and it is yet to close above the physcological 20,000 level. Sensex had hit all-time high of 20,238.16 on 30 October 2007 while its all time closing high is 19,977.67 on 29 October 2007.

Asian markets posted strong gains today, 7 December 2007. Hang Seng (up 1.25% to 29,929.33), Taiwan Weighted index (up 0.87% to 8,769.98), Straits Times index (up 1.79% to 3,616.28), Nikkei (up 0.93% to 16,021.12), Shanghai Composite index (up 0.81% to 5,075.65) and Seoul Composite index (up 0.03% to 1,953.7), all edged higher.

US markets surged on Thursday, 6 December 2007 on optimism that a plan announced by President George W Bush to stem US home foreclosures would keep the economy from sliding into a recession. The Dow Jones industrial average surged 174.93 points, or 1.30%, to end at 13,619.89. The Standard & Poor's 500 Index .SPX climbed 22.33 points, or 1.50%, to 1,507.34. The Nasdaq Composite Index soared 42.67 points, or 1.60%, to 2,709.03

The Bank of England lowered its key interest rate on Thursday, 6 December 2007 citing signs of slowing growth. The Monetary Policy Committee, or MPC, voted to reduce the official bank rate paid on commercial bank reserves by 0.25 basis points to 5.5%. However the European Central Bank Monetary Policy Committee decided to keep interest rates on hold at 4% after their monthly policy meeting yesterday, 6 December 2007.

Back home, the 30-share BSE Sensex rose 57.80 points or 0.29% to 19,795.87 on Thursday, 6 December 2007. The broader S&P CNX Nifty rose 14.70 points or 0.25% to 5954.70 for the day.

As per provisional data, foreign institutional investors (FIIs) purchased shares worth a net Rs 492.10 crore, while domestic institutional investors (DIIs) were net buyers of shares worth Rs 227.45 crore on Thursday, 6 December 2007.

FIIs were net sellers to the tune of Rs 235.96 crore in the futures & options segment on Thursday, 6 December 2007. They were net buyers of index futures to the tune of Rs 613.43 rore and bought index options worth Rs 80.99 crore. However they were net sellers of stock futures to the tune of Rs 929.43 crore and sold stock options worth Rs 0.95 crore.

Crude oil was little changed in New York after rising the most in almost three weeks as U.S. inventories dropped as refiners prepared to meet heating demand. Crude oil for January delivery rose 3 cents to $90.26 a barrel on the New York Mercantile Exchange in Singapore. Brent crude oil for January settlement yesterday rose $1.69, or 1.9%, to settle at $90.18 a barrel on the London-based ICE Futures Europe exchange.