Pre Session Commentary - Nov 25 2008

Today markets are likely to open positive as US markets have closed with phenomenal gains and major Asian markets have opened with positive gains. The investors would be little optimistic today as the major markets across the world are showing some strong positive movements. The positive sentiments are also backed by the US economic relief package announced by the US government. It is estimated that a total $ 7.7 trillion support has been planned to revamp the overall US economy. Such a major intervention by the US government will boost the economies across the world.

On Monday, domestic markets opened negative but later during the trading session it moved zigzag with extreme volatility. The domestic markets followed the trend of other Asian markets, which were also trading volatile. However the European markets traded positive on the back of speculations about the news that Britain’s labour government would slash the taxes to boost the consumer spending. After the volatile trading session the domestic markets ended mixed. Sensex ended with a loss of 0.14% whereas, Nifty closed with a marginal gain of 0.55% respectively. Realty, Bankex, CD, and Metal were thrashed by 3.78%, 3.14%, 2.33% and 1.55% respectively. During the trading session we expect the market to be trading in positive trend.

The BSE Sensex closed low by a marginal 12.09 points at 8,903.12 and NSE Nifty ended higher by 14.80 points at 2,708.25. The BSE Mid Caps and Small Caps closed with losses of 14.37 points at 2,902.29 and by 26.80 points at 3,363.96. The BSE Sensex touched intraday high of 9,042.02 and intraday low of 8,701.93.

On Monday, US markets closed with distinctive gains for the second consecutive trading day. The financial back given by US Federal Reserve has boosted the morale of investors to new highs. The US government is taking $20 billion stake in the Citi group, along with a huge back up of $ 306 billion of Citi group assets. Citi will absorb the first $29 billion in losses on the troubled assets and then 10% on any remaining losses, while the government will cover the remaining 90% in losses. Further the US president Barrac Obama is planning to come out with another bail out package of $ 700 billion so as to support the US economy and also create 2.5 million new jobs in another 2 years of time. Crude oil futures for the January delivery fell by 69 cents or 1.3% to $53.81 a barrel on New York Mercantile Exchange. Due to gain in the US stock markets and the government’s support for the financial sector, investors were optimistic the demand of crude oil.

The Dow Jones Industrial Average (DJIA) closed higher by 396.97 points at 8,443.39 NASDAQ index gained 87.67 points at 1,472.02 and the S&P 500 (SPX) also closed higher by 51.78 points to close at 851.81 points.

Indian ADRs ended positive with phenomenal gains. In technology sector, Infosys gained by 8.71% and Wipro ended high by 14.97% followed by Satyam that ended high by 8.56% and Patni Computers closing high by 4.60%. In banking sector ICICI Bank was high by 6.49%, while HDFC Bank gained 12.96%. In telecommunication sector, Tata Communication inclined by (27.41%), while MTNL inclined by 7.42%. Sterlite Industries was high by 3.85%.

Today the major stock markets in Asia opened mixed. The Shanghai Composite is trading low by 3.27 at 1,893.79 Hang Seng is high by 486.63 points at 12,944.57. Further Japan''s Nikkei is high by 259.59 points at 8,170.38. Straits Times is also trading high by 47.66 points at 1,667.95 and South Korea’s Seoul Composite is high by 25.05 points at 995.19.

The FIIs on Monday stood as net sellers in equity and net buyers in debt. The Gross equity purchased stood at Rs 1070.00 Crore and gross debt purchased stood at Rs 551.00 Crore, while the gross equity sold stood at Rs 1,584.00 Crore and gross debt sold stood at Rs 533.40 Crore. Therefore, the net investment of equity and debt reported were (Rs 514.10) Crore and Rs 17.60 Crore respectively.

On Monday, the partially convertible rupee ended at 50.09/10 per dollar, weaker by Rs 0.5 on Friday’s closing at 50.04/05. The volatile trading in the stock markets left the traders in confusion, however the dollar sales by exporters gave a support to the slipping rupee that touched the low at 50.25 in the day’s trading.

On BSE, total number of shares traded was 22.43 Crore and total turnover stood at Rs 3,206.82 Crore. On NSE, total volume of shares traded was 48.81 Crore and total turnover was Rs 8,505.62 Crore.

Top traded volumes on NSE Nifty – Unitech with 44124168 shares, Suzlon Energy with total volume traded 26557658 shares, followed by SAIL with 13245569 shares, ICICI Bank with 11080726 shares and Reliance Comm with 9439034 shares.

On NSE Future and Options, total number of contracts traded in index futures was 1317898 with a total turnover of Rs 16,732.61 crores. Along with this total number of contracts traded in stock futures were 1208462 with a total turnover of Rs 12,109.91 Crore. Total numbers of contracts for index options were 1220154 with a total turnover of Rs 16960.34 Crore and total numbers of contracts for stock options were 35424 and notional turnover was Rs 416.08 Crore.

Today, Nifty would have a support at 2,650 and resistance at 2,845 and BSE Sensex has support at 8,840 and resistance at 9,380.