Pre Session Commentary - Jan 1 2009

Today the markets are likely to open positive. The US markets have once again shown some positive momentum and firmness. On the back of expectations about a stimulus package from the government and further monetary relaxations from the RBI, the markets are likely to maintain some firm trading. The banks have started reducing home loan rates to help sustain the loan demand. Airlines have also reduced fares to support the industry growth. Slowly sectors have started working strategies to provide a long term support for their respective industry and the economy as a whole.

On Wednesday, the last day of the year 2008, the markets opened with a positive gap but could not resist the volatility pressures. The volatility continued and after the post mid session, markets could not escape the claw of selling pressures. Selling pressures were fierce on Banks, Oil & Gas and Realty Stocks and on the other hand Capital Goods, Auto and Metal Stocks witnessed some buying interests. Heavy stocks like ICICI bank, HDFC bank and RIL felt the heat. However, the madcap and small cap stocks cheered with the buying sentiments. Sensex and Nifty lost 0.71% and 0.68% respectively. Among the laggards Bankex, Oil & Gas and Realty fell by 1.29%, 0.98% and 0.41% respectively. During the session we expect the markets to be trading positive.

The BSE Sensex closed lower by 68.85 points at 9,647.31 and NSE Nifty ended low by 20.35 points at 2,959.15. The BSE Mid Caps and Small Caps ended with gains of 19.05 points and 47.63 points at 3,235.05 and 3,683.11 respectively. The BSE Sensex touched intraday high of 9,825.90 and intraday low of 9,587.92.

On Wednesday, the US markets closed in green for the second consecutive day. Without any major news items, participants were left to focus on a better-than-expected weekly jobless claims report. Claims for the week ending Dec. 27 totaled 492,000, down 94,000 from the prior week. The decline was largely treated as an aberration. There was also positive news that President-Elect Obama is hatching a massive economic stimulus plan. However, The Wall Street Journal reported such a plan may not reach Congress until late January. Crude oil futures for the month of February delivery rose $5.57 to $44.60 per barrel on New York Mercantile Exchange. The contract hit an intraday low of $36.94 a barrel in electronic trading. Crude oil inventories increased 549,000 barrels, according to the Dept. of Energy.

The Dow Jones Industrial Average (DJIA) closed high with 108.00 points at 8,776.39 NASDAQ index gained 26.33 points at 1,577.03 and the S&P 500 (SPX) also closed higher by 12.61 points to close at 903.25 points.

Indian ADRs ended mixed. In technology sector, Infosys gained by 0.49% and Wipro fell by 0.61%, further Satyam ended with a gain of 3.31% and Patni Computers closed high by 6.51%. In banking sector ICICI Bank gained 0.36%, HDFC Bank fell by 1.34%. In telecommunication sector, Tata Communication gained by 1.71%, while MTNL declined by 0.29%.

Today the major stock markets in Asia have closed. The Shanghai Composite is trading low by 12.10 points at 1,820.80 Hang Seng is high by 151.98 points at 14,387.48. Further Japan''s Nikkei and Korea’s Seoul Composite are closed till Jan 5th 2009. Taiwan weighted is high by 2.18 points 4,591.22 and Singapore’s Strait Times is closed.

The FIIs on Wednesday stood as net buyers in equity and debt. Gross equity purchased stood at Rs 882.20 Crore and gross debt purchased stood at Rs 1567.40 Crore, while the gross equity sold stood at Rs 757.80 Crore and gross debt sold stood at Rs 1295.30 Crore. Therefore, the net investment of equity and debt reported were Rs 124.40 Crore and Rs 272.10 Crore respectively.

On Wednesday Indian Rupee for the year end closed 48.70/72 per dollar, as against Tuesday’s close of 48.47/49, on the back of foreign fund withdrawals from the stock market and a widening trade deficit weighed. During 2008 the rupee fell 19.1% its biggest since 1990, however during 2007 it had gained a remarkable 12%.

On BSE, total number of shares traded were 34.64 Crore and total turnover stood at Rs 3,745.97 Crore. On NSE, total number of shares traded were 67.50 Crore and total turnover was Rs 8,946.66 Crore.

Top traded volumes on NSE Nifty – Unitech with 71398416 shares, Satyam with 52911442 shares, Suzlon Energy with total volume traded 38832426 shares, followed by SAIL with 11824698 shares and Reliance Petro 11695651 shares.

On NSE Future and Options, total number of contracts traded in index futures was 720614 with a total turnover of Rs 9,839.3 Crore. Along with this total number of contracts traded in stock futures were 832603 with a total turnover of Rs 8,820.37 Crore. Total numbers of contracts for index options were 688961 with a total turnover of Rs 10,694.52 Crore and total numbers of contracts for stock options were 59185 and notional turnover was Rs 678.79 Crore.

Today, Nifty would have a support at 2,918 and resistance at 3,021 and BSE Sensex has support at 9,510 and resistance at 9,846.