Pre Session Commentary - Nov 14 2008

Today markets are likely to open with positive gap as US markets closed positive despite some bad news. The Asian markets have also responded positively and hence opened with positive gap. The inflation numbers have calmed down to 8.98% showing some sign of relief as the crude oil prices have fallen to 22 months low. Amidst good macro economic factors we expect markets to trade in green.

On Wednesday, domestic Markets opened with a huge negative gap and later traded highly volatile. The huge negative gap later bounced back in the positive territory however the poor IIP numbers pulled the momentum. The European markets however traded mixed and the major indices like FTSE and DAX ended positive. Investors were in the trap of confusion and therefore remained cautious. Sensex and Nifty fell by 3.08% and 3.07% respectively. Realty plummet the highest by 7.34% followed by Bankex and Metal that fell by 4.38% and 3.67% respectively. During the trading session we expect the market to be trading in green.
The BSE Sensex closed lower by 303.36 points at 9,536.33 and NSE Nifty ended lower by 90.20 points at 2,848.45. The BSE Mid Caps and Small Caps closed with losses of 75.43 points at 3,281.27 and by 74.63 points at 3,813.38. The BSE Sensex touched intraday high of 9,928.60 and intraday low of 9,376.73.
On Thursday, US markets closed in green with phenomenal gains. The jobless claims were high as the claims for the week ended November 8 were at 5,16,000, which is considered as seven year high. Wal-Mart stated expects earnings for the fourth quarter to range from $1.03 to $1.07 per share, and from $3.42 to $3.46 per share for fiscal 2009. Despite such bad news investors didn’t hesitate to keep buying. Crude oil futures for the December delivery rose $3.72 cents to $59.37 a barrel on New York Mercantile Exchange. It also touched 22 months low in the previous trading session.

The Dow Jones Industrial Average (DJIA) closed higher by 552.59 points at 8835.25 NASDAQ index gained 97.49 points at 1,596.70 and the S&P 500 (SPX) also closed high by 58.99 points to close at 911.29 points.

Indian ADRs ended negative. In technology sector, Infosys gained (7.24%) and Wipro gained by (13.81%) followed by Satyam that ended high by (11.9%) and Patni Computers closing high by (12.85%). In banking sector ICICI Bank was high by (9.04%), while HDFC Bank rose (11.66%). In telecommunication sector, Tata Communication declined by (18.30%), while MTNL was high by (7.53%). Sterlite Industries was high by (11.09%).

Today the major stock markets in Asia opened positive. The Shanghai Composite is trading high by 19.65 at 1,947.27. Hang Seng is high by 378.98 points at 13,600.33. Further Japan''s Nikkei is high by 294.73 points at 8,533.37. Straits Times is also trading high by 30.12 points at 1,785.59 and South Korea’s Seoul Composite is high by 6.11 points at 1,094.55.

The FIIs on Wednesday stood as net seller in equity while net buyer in debt. The Gross equity purchased stood at Rs 1,347.40 Crore and gross debt purchased stood at Rs 1,604.80 Crore, while the gross equity sold stood at Rs 1,613.90 Crore and gross debt sold stood at Rs 266.60 Crore. Therefore, the net investment of equity and debt reported were (Rs 266.50) Crore and Rs 1,338.20 Crore respectively.

On Wednesday, the partially convertible rupee ended at 49.30/32 per dollar, it’s weakest in more than 12 years and 2% below Tuesday’s close of 48.125/140. The rupee fell on outflow from stock markets and heavy demand from PSU banks to meet the commercial operations.

On BSE, total number of shares traded was 28.37 Crore and total turnover stood at Rs 3,690.41 Crore. On NSE, total volume of shares traded was 61.36 Crore and total turnover was Rs 10,200.74 Crore.

Top traded volumes on NSE Nifty – Suzlon energy with 40125626 shares followed by Unitech 19890671 shares, SAIL with 17093645 shares, ICICI Bank with 14871870 shares and Reliance Petro with 14445054 shares respectively.

On NSE Future and Options, total numbers of contracts traded in index futures were 1321525 with a total turnover of Rs 17,895.87 Crore. Along with this total number of contracts traded in stock futures were 933055 with a total turnover of Rs 10,294.15 Crore. Total numbers of contracts for index options were 1378147 and total turnover was Rs 20,845.89 Crore and total numbers of contracts for stock options were 51116 and notional turnover was Rs 581.72 Crore.

Today, Nifty would have a support at 2,925 and resistance at 3,255 and BSE Sensex has support at 9,895 and resistance at 10,455.