Pre Session Commentary - Feb 4 2009

Today domestic markets are likely to open positive. The sentiments across other Asian markets are strong and therefore trading northwards. In the domestic arena the investors are trading cautiously and therefore yesterday’s trading session witnessed some volatility. There is no specific news to lead the domestic markets however the sentiments across other global markets would influence the markets’ move. We anticipate a positive trend in today’s session with an essence of mild volatility creeping.

On Tuesday, the markets opened a positive gap but could not sustain the selling pressure and traded volatile. However towards the end the markets managed to close in green despite volatility. The gap of news was observed during the session as markets moved the northward and southward zone. The early gain was pared off due to profit booking, which led the markets dive into red. However sectors like Oil & Gas, FMCG, IT and Bankex helped the markets close with a marginal gain. Huge selling was witnessed in sectors like Realty and CD that tumbled by 7.59% and 2.85%. Mid caps and Small caps also felt the burn as they lost 0.77% and 0.42% respectively. During the session we expect the markets to be trading positive with mild volatility.

The BSE Sensex closed up by 82.60 points at 9,149.30 and NSE Nifty ended with gains of 17.25 points at 2,783.90. The BSE Mid Caps and Small Caps ended with losses of 22.28 points and 13.92 points at 2,873.63 and 3,274.03 respectively. The BSE Sensex touched intraday high of 9,302.75 and intraday low of 9,040.56.

The US markets on Tuesday closed positive. The day’s trade started with the announcements from corporate world which led to mixed movements across broader markets. Towards the end heavy stocks managed to uplift the markets at broader level. In the financial sector Citigroup has announced its own plans to increase lending. The financial supermarket will use roughly $36.5 billion of the TARP funds it has received for new loans. The Auto sector faced huge selling pressure as Ford, GM and Toyota reported fall in January sales by 40%, 51% and 34% respectively. Crude oil futures for the month of March delivery rose by $0.70 to $40.78 per barrel on New York Mercantile Exchange. The crude surged on the back of statements form OPEC president that the cartel would reduce the production to support the price.

The Dow Jones Industrial Average (DJIA) closed upper by 141.53 points at 8,078.36 NASDAQ index gained 21.87 points at 1,516.30 and the S&P 500 (SPX) gained 13.07 points at 838.15.

Indian ADRs ended higher. In technology sector, Infosys ended up by 3.08% along with Wipro by 0.73%. Further, Satyam ended with decrease of 1% and Patni Computers closed lower by 1.07%. In banking sector ICICI Bank gained 1.31% and HDFC Bank advanced by 1.54%. In telecommunication sector, Tata Communication and MTNL increased by 0.57% and 4.17 respectively. Sterlite Industries increased by 6.30%.

Today major stock markets in Asia have opened positive. Shanghai composite is up by 34.71 points to 2,095.52, Japan''s Nikkei is also up by 168.58 points at 7,994.09 along with Hang Seng that surged 249.15 points at 13,026.05. South Korea''s Seoul Composite is up by 21.34 points at 1,184.54 and Singapore''s Strait Times is also up by 9.68 points to 1,721.60.

The FIIs on Tuesday stood as net sellers in equity and debt. Gross equity purchased stood at Rs 1,334.50 Crore and gross debt purchased stood at Rs 69.70 Crore, while the gross equity sold stood at Rs 1,346.50 Crore and gross debt sold stood at Rs 274.60 Crore. Therefore, the net investment of equity and debt reported were Rs (11.90) Crore and Rs (204.90) Crore respectively.

On Tuesday, the Indian rupee ended at 48.81/82 per dollar, 0.22% stronger than Monday’s close of 48.92/93. The rupee gained strength as the stock markets traded up and the exporters sold dollars.

On BSE, total number of shares traded were 28.71 Crore and total turnover stood at Rs 3,212.91 Crore. On NSE, total number of shares traded were 67.32 Crore and total turnover was Rs 92.26 Crore.

Top traded volumes on NSE Nifty – Unitech with 49998254 shares, DLF with 35516976 shares, Suzlon Energy with 25461508 shares, Reliance Petro with total volume traded 11212066 shares followed by SAIL with 10774843 shares.

On NSE Future and Options, total number of contracts traded in index futures was 1029682 with a total turnover of Rs 13,231.40 Crore. Along with this total number of contracts traded in stock futures were 970538 with a total turnover of Rs 9,204.90 Crore. Total numbers of contracts for index options were 1170676 with a total turnover of Rs 16,739.37 Crore and total numbers of contracts for stock options were 74475 and notional turnover was Rs 891.18 Crore.

Today, Nifty would have a support at 2,726 and resistance at 2,863 and BSE Sensex has support at 9,085 and resistance at 9,348.