Pre Session Commentary - Feb 10 2009

Today domestic markets are likely to open positive. The US markets have closed mixed on anticipations of another stimulus plan from Barack Obama. The stimulus package to be announced today by the US government may once again act as one of the triggers for domestic market sentiments as well. The CSO estimates for FY09 GDP growth at 7.10% looks little high but have also boosted the sentiments of investors which would support the markets at a firm level. On the other hand, major Asian markets have opened positive and therefore we anticipate another rally in today’s market at broader level.

On Monday, the markets opened with a phenomenal gain and sustained its northward movement till the end. The markets eagerly waited for the GDP growth estimates and as anticipated the CSO estimates for FYO9 GDP stood at 7.1% vs 9%(YoY), manufacturing seen at 4.8% vs 8.1%, financial services growth seen at 8.6% vs 11%, construction at 6.5% vs 10.1%, mining at 4.1% vs 8.2%, farm growth at 2.6% vs 4.9%. Despite weak global cues, the benchmark indices showed strong southward movement that helped all the sectors to close in green. Sectors like Metal, CD, CG, Oil & Gas and Bankex witnessed phenomenal gains of 4.41%, 3.69%, 3.59%, 3.37% and 3.19% respectively. Mid caps and Small caps also gained 1.70% and 1.63% respectively. During the session we expect the markets to be trading positive with an essence of volatility.

The BSE Sensex closed up by 283.03 points at 9,583.89 and NSE Nifty ended with gains of 76.80 points at 2,919.90. The BSE Mid Caps and Small Caps ended with gains of 49.15 points and 53.47 points at 2,931.95 and 3,332.71 respectively. The BSE Sensex touched intraday high of 9,601.56 and intraday low of 9,329.23.

The US markets on Monday closed mixed and rather flat. The investors were waiting for another stimulus plan to be announced but however the government delayed it for Tuesday as they are working out for a broader economic recovery plan. Senators are expected to vote on an $827 billion spending and tax cut plan early this week. The plan still has to be reconciled with that which was already approved by the House of Representatives. The earnings of corporate had little impact on the sentiments of the markets. However the day’s trade is not bad despite the markets closing mixed on marginal losses. US light crude oil for March delivery fell by $0.67 to settle at $39.56 a barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) closed low by 9.72 points at 8,270.87. NASDAQ index lost 0.15 points at 1,591.56 and the S&P 500 (SPX) gained 1.29 points at 869.89.

Indian ADRs ended mixed. In technology sector, Infosys ended higher by 1.21% along with Wipro by 1.51%. Further, Patni Computers ended with increase of 0.87% while Satyam closed down by 5.88%. In banking sector ICICI Bank and HDFC Bank gained 2.77% and 1.35% respectively. In telecommunication sector, Tata Communication advanced by 1.68% while MTNL lost 0.35%. Sterlite Industries increased by 3.49%.

Today major stock markets in Asia have opened mixed. Shanghai composite is up by 1.49 points to 2,226.20, Japan''s Nikkei is also up by 24.13 points at 7,993.16. Hang Seng surged 32.05 points at 13,801.11. South Korea''s Seoul Composite is low by 5.45 points at 1,197.24 and Singapore''s Strait Times is high by 10.58 points to 1,692.92.

The FIIs on Monday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 1,232.30 Crore and gross debt purchased stood at Rs 476.60 Crore, while the gross equity sold stood at Rs 1,172.00 Crore and gross debt sold stood at Rs 547.60 Crore. Therefore, the net investment of equity and debt reported were Rs 60.30 Crore and Rs (71) Crore respectively.

On Monday, the Indian rupee closed at 48.57/58 0.2% stronger than its previous close of 48.67/68. The rupee gained strengthened on the back of strong rally in the domestic stock markets, prompted the banks to sell their holdings.

On BSE, total number of shares traded were 28.92 Crore and total turnover stood at Rs 2,836.19 Crore. On NSE, total number of shares traded were 59.91 Crore and total turnover was Rs 78.71 Crore.

Top traded volumes on NSE Nifty – Unitech with 36318580 shares, SAIL with 17109122 shares, Suzlon Energy with 16852567 shares, DLF with total volume traded 10535254 shares followed by Reliance Petro with 8704339 shares.

On NSE Future and Options, total number of contracts traded in index futures was 800368 with a total turnover of Rs 10,708.86 Crore. Along with this total number of contracts traded in stock futures were 838860 with a total turnover of Rs 7,959.11 Crore. Total numbers of contracts for index options were 1147960 with a total turnover of Rs. 16,668.35 Crore and total numbers of contracts for stock options were 69030 and notional turnover was Rs 705.60 Crore.

Today, Nifty would have a support at 2,927 and resistance at 2,979 and BSE Sensex has support at 9,599 and resistance at 9,739.