Pre Session Commentary - Feb 5 2009

Today domestic markets are likely to open positive. Though the US markets tumbled yesterday due to worse earnings report, the Asian markets have opened with a positive note. The sentiments across the domestic arena are likely to move the markets in the northward direction amidst high essence of volatility. The deputy chairman of the planning commission Mr. Montek Singh Ahuwalliah has emphasized the need of further stimulus package to boost the economic growth and sustain a healthy economy in the turbulence prevailing across the world.

On Wednesday, the markets opened with a remarkable positive gap but later due to a volatile session it pared off early gains to close with a marginal gain. The session started with a phenomenal trend as was witnessed in other Asian markets. However due to lack of any supportive news the sentiments deteriorated towards the end. Sectors like CD & HC faced burns, however Metal, Realty and Oil & Gas which were brutally shattered for two consecutive previous days, managed to bounce back in today’s trade, registering gains of 2.99%, 1.18% and 0.73% respectively. Mid caps and Small caps also felt the heat of selling pressure as they lost 0.45% and 0.03% respectively. During the session we expect the markets to be trading volatile.

The BSE Sensex closed up by 52.55 points at 9,201.85 and NSE Nifty ended with gains of 19.15 points at 2,803.05. The BSE Mid Caps and Small Caps ended with losses of 13.07 points and 0.94 points at 2,860.56 and 3,273.09 respectively. The BSE Sensex touched intraday high of 9,338.21 and intraday low of 9,164.16.

The US markets on Wednesday closed negative. The investors succumbed to concerns about disappointing earnings of the consumer companies. On the other the macro economic news were not as bad as expected. The January ISM Service Index came in at 42.9, which is better than the consensus estimate of 39.0. There was better than expected job cuts during the month of January as the total job lost during the month was 5,22,000 as against the anticipated 5,35,000. However investors could not sustain the early trend and due to lack of support the markets started to buckle down.

The Dow Jones Industrial Average (DJIA) closed lower by 122.34 points at 7,956.02 NASDAQ index lost 1.25 points at 1,515.05 and the S&P 500 (SPX) lost 6.28 points at 832.23.

Indian ADRs ended lower. In technology sector, Infosys ended down by 1.31% along with Wipro by 1.16%. Further, Satyam ended with cut of 3.52% while Patni Computers closed up by 1.81%. In banking sector ICICI Bank and HDFC Bank lost 0.49% and 0.81% respectively. In telecommunication sector, Tata Communication and MTNL dropped by 2.62% and 4.33 respectively. However, Sterlite Industries increased by 2.15%.

Today major stock markets in Asia have opened mixed. Shanghai composite is up by 37.38 points to 2,145.13, Japan''s Nikkei is also down by 3.11 points at 8,035.83. Hang Seng surged 350.02 points at 13,413.91. South Korea''s Seoul Composite is up by 2.18 points at 1,197.55 and Singapore''s Strait Times is also up by 10.56 points to 1,717.95.

The FIIs on Wednesday stood as net sellers in equity and net buyers in debt. Gross equity purchased stood at Rs 1,221.30 Crore and gross debt purchased stood at Rs 385.70 Crore, while the gross equity sold stood at Rs 1,382.50 Crore and gross debt sold stood at Rs 137.90 Crore. Therefore, the net investment of equity and debt reported were Rs (161.20) Crore and Rs 247.80 Crore respectively.

On Wednesday, the Indian rupee ended at 48.82/83 per dollar, unchanged from Tuesday’s close of 48.81/82. The rupee touched its two weeks high at 48.60, however later fell as the stock markets pared off its early gains.

On BSE, total number of shares traded were 36.92 Crore and total turnover stood at Rs 2,947.14 Crore. On NSE, total number of shares traded were 74.47 Crore and total turnover was Rs 78.99 Crore.

Top traded volumes on NSE Nifty – Unitech with 37220468 shares, DLF with 29311808 shares, Suzlon Energy with 15289334 shares, SAIL with total volume traded 10191964 shares followed by Reliance Comm with 9825363 shares.

On NSE Future and Options, total number of contracts traded in index futures was 778867 with a total turnover of Rs 10,055.32 Crore. Along with this total number of contracts traded in stock futures were 817006 with a total turnover of Rs 7,439.63 Crore. Total numbers of contracts for index options were 970956 with a total turnover of Rs 13,913.49 Crore and total numbers of contracts for stock options were 66308 and notional turnover was Rs 659.59 Crore.

Today, Nifty would have a support at 2,778 and resistance at 2,849 and BSE Sensex has support at 9,085 and resistance at 9,310.