Pre Session Commentary - Jan 20 2009

Today the markets are likely to open negative as the Asian markets have opened with heavy blood bath. Yesterday’s trade exuded the sense of cautiousness and fear which is likely to haunt in today’s trade as well. The EU commission has forecasted that the GDP growth rate for UK would be at -2.8% during 2009 from -1.0% earlier. Further it also forecasts that the US economy would contract by 1.6% this year. The intensity of bearishness would be harsh today as the European markets closed in red yesterday and today the Asian markets are trapped in the tight claw of bears. There is no special news in the markets that would support the buying sentiments and hence one could anticipate severe selling pressure across broader markets.

On Monday, the markets closed flat after a volatile session. The sentiments were not that strong throughout the day’s session to keep the markets above the base line. The volumes of trade in NSE as well as BSE were also far below the average level exuding sings of reluctance and interest. The European markets further jolted the domestic sentiments as after the announcement of a stimulus package worth 200 billion pounds from the UK government, the European markets trade red. However, the major Asian markets managed to close in green after a nervous trading. There was no special news in the domestic arena that could have spurred the domestic sentiments. Sectors like Realty, Metal, Oil & Gas and CG closed with gains of 2.17%, 1.85%, 1.46% and 1.32% respectively. On the other hand Bankex, IT and Auto shed 0.97%, 0.75% and 0.38% respectively. Sensex and Nifty gained 0.06% and 0.63% respectively. Mid caps and Small caps gained by 0.55% and 1.13% respectively. During the session we expect the markets to be trading in deep red.

The BSE Sensex closed higher by 5.98 points at 9,323.59 and NSE Nifty gained by 17.75 points at 2,846.20. The BSE Mid Caps and Small Caps ended with gains of 16.70 points and 38.69 points at 3,043.53 and 3,451.46 respectively. The BSE Sensex touched intraday high of 9,409.51 and intraday low of 9,273.47.

Markets in the US were closed on Monday for Martin Luther King Jr. Day.

Today major stock markets in Asia have opened with heavy losses. The Shanghai Composite is trading low by 27.05 points at 1,959.62 while Hang Seng is low by 463.31 points at 12,876.68. Further Japan''s Nikkei is trading low by 226.81 points at 8,030.04. South Korea’s Seoul Composite is low by 28.73 points at 1,121.92 and Singapore’s Strait Times is also low by 40.36 points at 1,706.63.

The FIIs on Monday stood as net sellers in equity and net buyers in debt. Gross equity purchased stood at Rs 835.30 Crore and gross debt purchased stood at Rs 772.50 Crore, while the gross equity sold stood at Rs 1398.50 Crore and gross debt sold stood at Rs 322.90 Crore. Therefore, the net investment of equity and debt reported were Rs (563.20) Crore and Rs 449.60 Crore respectively.

On Monday, Indian Rupee closed at 48.70/71 per dollar, 0.2% stronger than Friday’s close of 48.78/80. The rupee shed off from its high at 48.50 on concerns of choppy share markets and weak expectations of foreign capital inflow.

On BSE, total number of shares traded were 32.28 Crore and total turnover stood at Rs 2,612.82 Crore. On NSE, total number of shares traded were 62.59 Crore and total turnover was Rs 6,818.92 Crore.

Top traded volumes on NSE Nifty – Unitech with 183768320 shares, Suzlon Energy with 27926330 shares, DLF with 11566589 shares, SAIL with total volume traded 10332457 shares followed by Reliance Petro with 8868290 shares.

On NSE Future and Options, total number of contracts traded in index futures was 592841 with a total turnover of Rs 7,803.48 Crore. Along with this total number of contracts traded in stock futures were 845310 with a total turnover of Rs 7,035.21 Crore. Total numbers of contracts for index options were 761579 with a total turnover of Rs 10,932.18 Crore and total numbers of contracts for stock options were 68621 and notional turnover was Rs 690.95 Crore.

Today, Nifty would have a support at 2,722 and resistance at 2,802 and BSE Sensex has support at 9,020 and resistance at 9,265.