Market seen rallying on NSG approval

Key benchmark indices are geared for a sharp upward gap opening after the 45-nation Nuclear Supplier Group (NSG) on Saturday, 6 September 2008 reached a consensus on the crucial Indo-US nuke deal agreeing on a clean waiver for India. Boosted by the deal, the SGX Nifty surged 190.50 points to 4,558.50 in opening trade. Global cues were mixed. Crude oil gained over $2 per barrel.

The NSG’s acceptance of the US proposal to drop the ban on nuclear trade will now put the Indo-US nuclear deal on the fast track. The approval came after almost three days of meeting in Vienna, ending a three-decade-long ban on India buying materials related to nuclear energy. The NSG meet was called to minimise any damage to the Non-Proliferation Treaty, which India has not joined.

However, the nuclear deal still needs to be ratified by the US Congress before it could take force. The Congress must act before adjourning in late September 2008 for US presidential elections. If that does not happen then the deal could be left to an uncertain fate under a new US administration that takes office next year.

New York's main contract, light sweet crude for delivery in October 2008 rose $2.37 to $108.60 per barrel today, 8 September 2008 on worries hurricane Ike will threaten production facilities in the oil-rich US Gulf Coast.

Most Asian markets were trading firm today, 8 September 2008. Japan's Nikkei gained 3.59% or 438.04 points at 12,650.27, Hong Kong's Hang Seng rose 3.99% or 795.86 points at 20,729.14, Taiwan's Taiwan Weighted advanced 5.28% or 333.24 points at 6,640.52, Singapore's Straits Times surged 3.57% or 91.87 points at 2,666.08, South Korea's Seoul Composite added 4.40% or 61.82 points at 1,466.2. However, China's Shanghai Composite was down 0.27% or 6.01 points at 2,196.43

US markets ended mixed on Friday, 5 September 2008 after financial shares rebounded on hopes that concrete measures would be taken to rescue mortgage companies Fannie Mae and Freddie Mac. The Dow Jones industrial average roe 32.73 points, or 0.29%, to 11,220.96. The Standard & Poor's 500 index gained 5.48 points, or 0.44%, to 1,242.31. However the Nasdaq composite index slid 3.16 points, or 0.14%, to 2,255.88.

Back home, intense selling in index pivotals ever since the opening bell tracking weak global markets led a sell-off on the bourses on Friday, 5 September 2008. The BSE 30-share Sensex lost 415.27 points or 2.79% to 14,483.83 and the S&P CNX Nifty declined 95.45 points or 2.15%, to settle at 4352.30.

Gains led by a sharp fall in oil price were erased by setback in global equities and domestic political concerns. The Sensex lost 80.70 points or 0.55% to 14,483.83 and the S&P CNX Nifty lost 7.70 points or 0.17% to 4352.30 in the week ended Friday, 5 September 2008.

Foreign institutional investors (FIIs) were net equity sellers worth Rs 1857 crore while mutual funds purchased shares worth Rs 484.77 crore on Friday, 5 September 2008, according to provisional data on NSE.

FIIs were net sellers of Rs 949.97 crore in the futures & options segment on Friday, 5 September 2008. They were net sellers of index futures to the tune of Rs 632.74 crore and purchased index options worth Rs 345.37 crore. They were net sellers of stock futures to the tune of Rs 743.27 crore and bought stock options worth Rs 80.68 crore.