Pre Market Watch - Dec 19 2008

Today the markets are expected to open up in red as most of the Asian benchmark indices are trading in red. Going further, the markets may continue to be volatile as some policy news and rate cuts are expected to flow in. The fall in inflation numbers will not only boost the moral of investors but also support the moves for policymakers. In addition the slumping crude oil price may give some energy to the energy stocks.

On Thursday, the markets were flat in the pre mid session and soon in the post session it turned into whopping gains. The significant gain was primarily attributed by the fall in inflation numbers to 6.84%, which may inspire the RBI to think over the further rate cut. The inflation numbers fell by 116bps to 6.84% for the week ended December 6, 2008 as compared to 8% the week before. Sensex and Nifty lost 2.62% and 2.87%. Realty, Teck, Power and Metal conceded losses of 7.36%, 5.02%, 4.44% and 4.36% respectively. Among the sectors the rate sensitive sectors like Realty, Bankex, Power and Auto rolled the red carpet for bulls. During the trading session we expect the markets to be trading volatile with negative bias.

The BSE Sensex closed higher by 361.14 points at 10,076.43 and NSE Nifty ended up by 106.40 points at 3060.75. The BSE Mid Caps and Small Caps ended with gains of 68.39 points and 33.39 points at 3,204.56 and 3,678.56 respectively. The BSE Sensex touched intraday high of 10,110.34 and intraday low of 9,633.04.
On Thursday, the US markets closed in red. The sentiments were weak as the the rating agency S&P has threatened General Electric of down sizing its current rating “AAA” to negative. In addition the falling oil prices crippled the energy shares. Chevron Corp and Exxon Mobil were the biggest drags on the Dow for the second consecutive session as oil fell almost $4, or about 10 percent, to settle near $36 a barrel on growing fears of falling demand. Crude oil futures for the month of January delivery fell $3.84 to $36.22 per barrel on New York Mercantile Exchange. The crude futures have touched an intraday of $35.98 per barrel in the electronic trading. The crude prices have reached a new record level since mid of 2004 as investors pay less attention to worried about the production cut by the Organization of the Petroleum Exporting Countries.
The Dow Jones Industrial Average (DJIA) closed low with 219.35 points at 8,604.99 NASDAQ index fell 26.94 points at 1,552.37 and the S&P 500 (SPX) also closed lower by 19.14 points to close at 885.28 points.
Indian ADRs ended mixed. In technology sector, Infosys gained by 2.29% and Wipro also gained by 3.29% whereas Satyam that dropped by 3.86% and Patni Computers closing low by 3.80%. In banking sector ICICI Bank lost 2.45%, HDFC Bank grew by 0.79%. In telecommunication sector, Tata Communication rose by 5.93%, while MTNL inclined by 3.87%.

Today the major stock markets in Asia opened weak. The Shanghai Composite is trading low by 4.51 at 2,011.18 Hang Seng is low by 282.37 points at 15,215.44. Further Japan''s Nikkei slipped by 94.95 points at 8,572.28. Tiwan weighted low by 4,651.35 points at 1,176.83 and Singapore’s Strait Times is low by 9.43 points at 1,789.52.

The FIIs on Thursday stood as net sellers in equity and debt. Gross equity purchased stood at Rs 2,288.10 Crore and gross debt purchased stood at Rs 305.20 Crore, while the gross equity sold stood at Rs 2,396.80 Crore and gross debt sold stood at Rs 697.00 Crore. Therefore, the net investment of equity and debt reported were Rs (108.70) Crore and Rs (391.90) Crore respectively.

On Thursday Indian Rupee closed at 46.95/96 a dollar, 1.5% stronger than Wednesday''s close of 47.67/69. Rupee gained strength in the wake of rally in the domestic market. As well as the dollar witnessed weakness in the global market.

On BSE, total number of shares traded were 39.43 Crore and total turnover stood at Rs 5,095.54 Crore. On NSE, total number of shares traded were 85.75 Crore and total turnover was Rs 13,363.39 Crore.

Top traded volumes on NSE Nifty – Unitech with 68693875 shares, Suzlon Energy with total volume traded 57199637 shares, Satyam with 36272449 shares, followed by DLF with 18466028 shares, SAIL with 15279032 shares.

On NSE Future and Options, total number of contracts traded in index futures was 1237329 with a total turnover of Rs 17489.91 Crore. Along with this total number of contracts traded in stock futures were 1469346 with a total turnover of Rs 15976.89 Crore. Total numbers of contracts for index options were 1333958 with a total turnover of Rs 20107.92 Crore and total numbers of contracts for stock options were 88989 and notional turnover was Rs 1032.39 Crore.

Today, Nifty would have a support at 2,980 and resistance at 3,100 and BSE Sensex has support at 9,750 and resistance at 10,150.