Pre Market Watch - March 24 2008

The Indian Market is likely to have a positive opening today as he global markets are in favor. On Wednesday, pared most of its initial gains on the back of heavy profit booking across the sectoral indices towards the final trading hours of the session. The domestic market opened with a bang and created a rally across the sectoral indices on the back of favoring cues from the global markets like interest rate cut by US Federal Reserve and better than expected strong performance from- Goldman Sachs Group and Lehman Brothers Holdings, the two major investment banks. But the market was unable to sustained at higher levels and gave up most of its initial gains on the back of long holiday. The BSE Sensex closed higher by 161.37 points at 14,994.83 and NSE Nifty grew by 40.95 points to close 4573.95. We expect that the market may remain choppy during the trading session.

On Friday, the US market closed in green. The Dow Jones Industrial Average (DJIA) closed higher by 261.66 points at 12,361.32. The S&P 500 (SPX) index grew by 31.09 points to close at 1,329.51 and NASDAQ Composite (RIXF) increased by 48.15 points to close at 2,258.11.

The Indian ADRS closed in positive. In technology sector, Wipro grew by (4%) along with Patni Computers by (3.75%), Satyam by (1.66%) and Infosys by (1.50%). In banking sector, HDFC bank and ICICI bank increased by (2.58%) and (1.21%) respectively. In telecommunication sector, Tata Communication and MTNL advanced by (3.47%) and (0.41%) respectively.

Today the major stock markets in Asia are trading firm. Taiwan Weighted is trading higher by 344.84 points at 8,869.83 along with Japan’s Nikkei trading up by 46.33 points at 12,528.90 and Singapore Strait Times trading at 2,891.02 up by 66.11 points. South Korea Seoul Composite is trading marginally higher by 7.26 points at 1,652.95.

The FIIs on Wednesday stood as net seller both in equity as well as debt. The gross equity purchased was Rs4,701.30 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs5,389.10 Crore and gross debt sold stood at Rs148.20 Crore. Therefore, the net investment of equity reported was (Rs687.80 Crore) and net debt was (Rs148.20 Crore).

The Wholesale Price index rose to an 11-month high of 5.92%. The WPI-based inflation increased sharply on account of spurt in prices across the board, with cereals (6.28%), milk (9.71%), vegetables (9.79%), dairy products (9.31%), cement (5.13%), iron and steel (20.87%) and edible oils (17.52%). By seeing this growth in inflation, the Indian government has reduced customs duty on rice and edible oils drastically to rein in their prices in domestic market. The customs duty on rice has been cut to nil from 70% earlier as well as duties on all crude and refined edible oils were also slashed from the existing levels of 52% and 75% to 20% and 27.5% respectively.

Today, Nifty has support at 4,471 and resistance at 4,708 and BSE Sensex has support at 14,623 and resistance at 15,312.