Pre Session Commentary - Feb 16 2009

Today domestic markets are likely to open positive as there are huge expectations of tax sops in the interim budget to be presented today. After an early gain in the previous week end, today once again one could anticipate a good and firm trend. Sectors like Bankex, Realty and Auto could be on the lime light due to expectations of further interest rate cut and some special package for the other two. The trend during the day’s session is likely to sustain its firmness on domestic triggers and would remain shield against other Asian and European markets’ cues.

On Friday, the markets opened with a positive gap as the other Asian markets had opened in green. The sentiments across the broader markets were strong as the interim budget of Railways brought some cheer. For the year FY09 the railways showed a cash surplus of Rs 90 billion. The rate cuts on passenger fares and opening of new routes were some cheers for the billion Indian citizens. The feel good factor ahead of the interim budget to be presented on Monday keeps the markets on firm trend. Sectors like Metal, CG, Realty, Power and Auto gained by phenomenal 2.80%, 2.48%, 2.29%, 2.28% and 2.24% respectively. Mid caps and Small caps gained 1.51% and 0.62% respectively. During the session we expect the markets to be trading with a firm trend.

The BSE Sensex closed up by 168.91 points at 9,634.74 and NSE Nifty ended with a gain of 55.30 points at 2,948.35. The BSE Mid Caps and Small Caps ended with gains of 44.84 points and 20.79 points at 3,012.95 and 3,395.58 respectively. The BSE Sensex touched intraday high of 9,695.59 and intraday low of 9,540.60.

On Friday, the US stock markets closed in red. There was lack of special news that could swing the markets and therefore investors traded choppy throughout the session to evade any risks. The $ 787 billion bail out package announced on the previous day had very little influenced the sentiments of investors. The financial sector lamented after a fall of 4.2% for the day and an over all 10.2% during the week. Further on Monday U.S. markets are closed in observance of Presidents Day. US light crude oil for March delivery gained by $3.53 to settle at $37.51 a barrel on the New York Mercantile Exchange. OPEC, supplier of more than 40% of the world’s oil, may decide to reduce crude production further when it meets in March if the price remains below $40 a barrel.

The Dow Jones Industrial Average (DJIA) dropped by 82.35 points to close at 7,850.41. The NASDAQ Composite (RIXF) index fell by 7.35 points to close at 1,534.36 and the S&P 500 (SPX) lost by 8.35 points to close at 826.84.

Indian ADRs ended mixed. In technology sector, Satyam ended up by 11.70%. Further, Wipro ended with decrease of 1.02% Infosys by 2.55% and Patni Computers closed down by 2.05%. In banking sector HDFC Bank and ICICI Bank lost 2.50% and 1.85% respectively. In telecommunication sector, MTNL and Tata Communication advanced by 1.71% and 1.91% respectively. However, Sterlite Industries remained unchanged.

Today major stock markets in Asia are trading mixed. Shanghai composite is higher by 30.62 points to 2,351.42, Japan''s Nikkei is low by 19.83 points at 7,759.57. Hang Seng lost 234.36 points at 13,320.31, South Korea''s Seoul Composite is low by 5.89 points at 1,186.55 and Singapore''s Strait Times is lower by 7.14 points to 1,698.50.

The FIIs on Friday stood as net sellers in equity and debt. Gross equity purchased stood at Rs 871.70 Crore and gross debt purchased stood at Rs 18 Crore, while the gross equity sold stood at Rs 1,037.40 Crore and gross debt sold stood at Rs 94.20 Crore. Therefore, the net investment of equity and debt reported were Rs (165.60) Crore and Rs (76.20) Crore respectively.

On Friday, the Indian rupee closed at 48.66/67, 0.39% stronger than its previous close of 48.85/86. The rupee appreciated as banks cut their long positions in dollar and the domestic markets gain helped it further.

On BSE, total number of shares traded were 30.53 Crore and total turnover stood at Rs 3,103.17 Crore. On NSE, total number of shares traded were 61.17 Crore and total turnover was Rs 82.27 Crore.

Top traded volumes on NSE Nifty – Unitech with 39529354 shares, Suzlon Energy with 16834204 shares, DLF with 12556129 shares, Reliance Comm with total volume traded 12010898 shares followed by SAIL with 9707423 shares.

On NSE Future and Options, total number of contracts traded in index futures was 604388 with a total turnover of Rs 8,261.22 Crore. Along with this total number of contracts traded in stock futures were 826798 with a total turnover of Rs 8,712.44 Crore. Total numbers of contracts for index options were 958057 with a total turnover of Rs. 14,027.10 Crore and total numbers of contracts for stock options were 68987 and notional turnover was Rs 772.23 Crore.

Today, Nifty would have a support at 2,975 and resistance at 3,033 and BSE Sensex has support at 9,722 and resistance at 9,882.