Pre Session Commentary - Nov 6 2008

Today a market is expected to have gap down opening on weak global cues. US markets ended sharply lower and today Asian markets are trading weak. Wednesday, Indian market broke its five-day winning streak and ended in deep red due to the negative European markets and lower US index futures. Investors once again turned towards concern over troubled economy after the US presidential election. Market opened on positive note tracking firm cues from the global markets. Asian markets were higher as Barack Obama elected as the 44th US President, which ended the uncertainty about the leader of US economy during the financial crises. Further, market was not able to hold the same momentum and start losing ground soon after start. During final trading hours market slipped sharply lower to deep red on aggressive selling pressure. From the sectoral front, the Oil & Gas, Metal, Reality, Capital Goods and Power stocks contributed to the most of the selling pressure. While, Pharma stocks were in limelight as most of the buying was witnessed from its baskets. We expect market to trade lower during the trading session. Inflation data for the week ended 25th October 2008, due to be released today will also be a concern for the market.

The BSE Sensex closed lower by 511.11 points at 10,120.01 and NSE Nifty ended down by 147.15 points at 2,994.95. The BSE Mid Caps and Small Caps closed with losses of 51.61 points 3,394.61 and by 70.33 points at 3,964.78. The BSE Sensex touched intraday high of 10,945.41 and intraday low of 10,051.51.

Wednesday, the US markets wiped away the previous days’ gains, which was largest Election Day gain and reported sharp decline. The decline was mainly led by economic concern and profit booking. Private nonfarm employment fell by a larger-than-expected 157,000 in October, according to ADP. Crude oil futures for the December delivery fell $5.23 to $65.3 a barrel on New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) dropped by 486.01 points to close at 9,139.27. The NASDAQ Composite (RIXF) index decreased by 98.48 points to close at 1,681.64 and the S&P 500 (SPX) lost 52.98 points to close at 952.77.

Indian ADRs ended down. In technology sector, Wipro ended lower by (4.28%) along with Infosys lost (7.72%), Patni Computers ended down by (6.25%) and Satyam closed lower by (4.37%). In banking sector ICICI Bank was down by (11.92%) and HDFC Bank lost (10.78%). In telecommunication sector, Tata Communication declined by (13.80%) and MTNL was down by (9.55%). Sterlite Industries decreased by (8.52%).

Today major stock markets in Asia are trading lower. Hang Seng is trading lower by 882.48 points at 13,957.68. Further, Japan''s Nikkei lost 541.06 points at 8,980.18 and Singapore’s Straits Times plunged 87.65 points at 1,781.17. The South Korea’s Seoul Composite lost 78.70 points at 1,102.80 and Taiwan Weighted tumbled 241.47 points at 4,736.79.

The FIIs on Wednesday stood as net seller in equity and in debt. Gross equity purchased stood at Rs1968.30 Crore and gross debt purchased stood at Rs83.10 Crore, while the gross equity sold stood at Rs2061.20 Crore and gross debt sold stood at Rs121.00 Crore. Therefore, the net investment of equity and debt reported were (Rs93.00 Crore) and (Rs38.00 Crore) respectively.

On Wednesday, the Indian rupee ended at 47.46/50 0.5% stronger from 48.69/70 at close on Tuesday on support of dollar sales by exporters. India''s rupee pared its gains after hitting a one-month high, as heavy loss in the local stock market raised concerns of more capital outflows.

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Foreign direct investment (FDI) in India increased 259% in September to $2.56 billion, compared to the same month last year, with Mauritius being the largest investor. FDI for the same month last year stood at $713 million. The services sector attracted the highest foreign investment at $2.34 billion.

On BSE, total number of shares traded was 39.16 Crore and total turnover stood at Rs. 4,983.72 Crore. On NSE, total volume of shares traded was 80.756 Crore and total turnover was Rs 13,040.48 Crore.

Top traded volumes on NSE Nifty – Suzlon Energy with total traded volume of 72123210 shares, followed by Unitech Ltd with 29273672 shares, RPL with 22325657 shares, ICICI Bank with 18388708 shares and DLF Ltd with 11793141 shares respectively.

On NSE Future and Options, total numbers of contracts traded in index futures were 949325 with a total turnover of Rs.13,767.86 Crore. Along with this total number of contracts traded in stock futures were 1019103 with a total turnover of Rs.11,294.69 Crore. Total numbers of contracts for index options were 820304 and total turnover was Rs.12,958.26 Crore and total numbers of contracts for stock options were 47870 and notional turnover was Rs.530.12 Crore.

Today, Nifty would have a support at 2,762 and resistance at 2,990 and BSE Sensex has support at 9,522 and resistance at 10,332.