Pre Session Commentary - June 13 2008

The Indian Market is expected to have positive opening on the back of mixed global cues. On Thursday, the Indian market closed upbeat after recovering from earlier losses towards final trading hours. The market opened with bad temper on the back of weak global cues and was trading without any sign of recovery. It was hovering in negative territory but started recovering smartly after industrial production data released which was better than expected and bounced back to close in green. The IIP growth for the month of April 2008 stood at 7%, which was lower against 11.3% in the corresponding month of the previous year but better than 3.9% in the month of March 2008. From the sectoral front, Oil & Gas, Metal and Capital Goods stocks witnessed most of the buying interest. The BSE Sensex closed higher by 64.88 points at 15,250.20 and NSE Nifty ended up by 15.75 points to close at 4,539.35. We expect that market may remain volatile and inflation figure for the week ending 31st May 2008 due out today, will give further direction to the market.

The Reserve Bank of India on Wednesday raised repo rate by 25 basis points to 8% to curb inflation, and according to analysts more tightening is expected if inflation continued to head towards double digits. This hike is signal of rise in interest rates. Interest rate sensitive sectors like bank though faced the heavy selling across the counters but made a smart pull back towards the end. The Auto index also made a smart come back ignoring the repo rate hike to close almost on a flat note.

On Thursday, the US market closed in positive territory on M&A news of $46 billion takeover bid for Anheuser-Busch and better than expected retail sales. It opened higher with oil slipping and positive retail sales. It give back its earlier gains but still maintained to close in positive. New York''s main oil futures contract, light sweet crude for July delivery, eased 19 cents to $136.55 a barrel.

The Dow Jones Industrial Average (DJIA) closed higher by 57.81 points at 12,141.58 along with NASDAQ went up by 10.34 points to close at 2,404.35 and S&P 500 advanced by 4.38 points to close at 1,339.87.

Indian ADRS ended mixed. In technology sector, Satyam grew by (5.69%) along with Wipro by (4.41%), Infosys by (3.43%) while Patni Computers dropped by (0.17%). In banking sector, ICICI bank and HDFC bank increased by (8.12%) and (4.42%) respectively. In telecommunication sector, Tata Communication and MTNL dropped by (2.27%) and (1.36%). Sterlite industries inclined by (2.02%).

Today the major stock markets in Asia are trading in red on inflation fears. Hang Seng index is trading lower by 154.13 points at 22,869.73 along with Taiwan Weighted trading at 8,089.91 down by 27.60 points and Japan’s Nikkei index trading down by 22.31 points at 13,866.29.

The FIIs Thursday stood as net seller in equity. The gross equity purchased was Rs3,768.40 Crore and the gross debt purchased was Rs0.00 Crore while the gross equity sold stood at Rs3,919.90 Crore and gross debt sold stood at Rs0.00 Crore. Therefore, the net investment of equity reported was Rs(151.50) Crore and net debt was Rs0.00 Crore.

Today, Nifty has support at 4,455 and resistance at 4,642 and BSE Sensex has support at 15,030 and resistance at 15,529