Pre Session Commentary - Oct 24 2008

Today Markets are likely to open negative as Asian markets have opened with a blood bath despite mixed close of the US markets. The domestic investors are skeptic about the present economic scenario and the carnage happening across the world. RBI is set to come up with its Credit Policy today. On the other hand SEBI is stringent with the FIIs about the short selling and winding up of positions in the market so as to give the markets a little stability. Inflation numbers are good as it has fallen by 37bps. Inflation for the week ended 11th October 2008, stood at 11.07% as against to 11.44% of the previous week.

On Thursday, domestic Markets lost 398.20 points as it opened with a huge negative gap. The carnage was basically fuelled by the falling Asian and European markets. Metal was the worst hit as the metal prices are falling across the world on the back of skepticism about economic growth. The investors were little cautious about their positions before the Credit Policy to be announced today. Metal, Auto, Oil & Gas and Realty witnessed heavy selling pressures and fell by 11.08%, 7.21%, 5.30% and 5.26% respectively. In the metal index Tata Steel and SAIL plummeted heavily by 14.85% and 14.39% respectively. During the trading session we expect the market to be trading volatile.

The BSE Sensex closed lower by 398.20 points at 9,771.70 and NSE Nifty ended down by 122 points at 2,943.15. The BSE Mid Caps and Small Caps closed with losses of 111.67 points 3,378.72 and by 145.99 points at 3,965.70. The BSE Sensex touched intraday high of 10,260.55 and intraday low of 9,681.28.

On Thursday, US markets closed mixed amidst concerns over the jobless claims and also the better than expected quarterly results. Despite good quarterly numbers the investors are pessimistic about the outlook of these companies. On the other hand jobless claims for the week ending Oct. 18 rose 15,000 to 478,000, surpassing 468,000 claims that were expected. Crude oil futures for the December delivery gained $1.09 to $67.84 a barrel on New York Mercantile Exchange. The surge in the oil prices was expected as the traders are anticipating a production cut from OPEC which is meeting today to discuss the production and price issues.

The Dow Jones Industrial Average (DJIA) closed with a gain of 172.04 points at 8,691.25. NASDAQ index lost 11.84 points at 1,603.91 and the S&P 500 (SPX) gained 11.33 points to close at 908.11 points.

Indian ADRs ended mixed. In technology sector, Wipro slipped (4.13%) and Satyam lost by (0.14%) while Infosys ended up by (1.97%) and Patni Computers closing higher by (0.73%). In banking sector HDFC Bank was up by (4.20%) and ICICI Bank gained (1.91%). In telecommunication sector, Tata Communication inclined by (10.08%), and MTNL was up by (8.97%). Sterlite Industries was down by (2.23%).

Today the major stock markets in Asia opened mixed. The Shanghai Composite is trading high by 11.66 points, at 1,887.22. Hang Seng is low by 288.23 points at 13,472.26. Further Japan''s Nikkei is low by 400.90 points at 8,060.08. Straits Times is trading is also trading low by 53.05 points at 1,692.62 and South Korea’s Seoul Composite is low by 46.51 points at 1,003.2.

The FIIs on Thursday stood as net seller in equity and net buyer in debt. Gross equity purchased stood at Rs1724.60 Crore and gross debt purchased stood at Rs537.30 Crore, while the gross equity sold stood at Rs1997.50 Crore and gross debt sold stood at Rs422.80 Crore. Therefore, the net investment of equity and debt reported were (Rs272.90 Crore) and Rs144.60 Crore respectively.

On Thursday, the partially convertible rupee ended at 49.81/82 per dollar, 1.1% weaker than Wednesday''s close of 49.28/29, but off the days’ low of 49.86. The rupee hit to record low on another sharp drop in the stock market and broad-based dollar strength.

On BSE, total number of shares traded was Rs. 23.88 Crore and total turnover stood at Rs. 3,754.82 Crore. On NSE, total volume of shares traded was Rs. 52.20 Crore and total turnover was Rs 10,552.58 Crore.

Top traded volumes on NSE Nifty – Reliance Petro with total traded volume of 31876780 shares, followed by Idea Celluar with 17421399 shares, ICICI Bank with 15491109 shares, Unitech with 15377250 shares and SAIL with 11210202 shares respectively.

On NSE Future and Options, total numbers of contracts traded in index futures were 1396009 with a total turnover of Rs 19,814.7 Crore. Along with this total number of contracts traded in stock futures were 1170735 with a total turnover of Rs 13,533.26 Crore. Total numbers of contracts for index options were 1226867 and total turnover was Rs 19,670.69 Crore and total numbers of contracts for stock options were 44994 and notional turnover was Rs 606.3 Crore.

Today, Nifty would have a support at 2,865 and resistance at 3,015 and BSE Sensex has support at 9,495 and resistance at 10,105.