Pre Session Commentary - March 20 2009

Today domestic markets are likely to have negative opening tracking the weakness in the global markets. US Federal Reserve''s move to buy up to $300 bn in government securities lead the concerns of rising inflations. Along with this, Fed also announced to expand its balance sheet by purchasing up to an additional $750bn of mortgage-backed securities. The key rates have been left unchanged at near zero. The other Asian markets are also not supportive and Japan''s market is closed for public holiday. On the domestic front one could witness some softening in the opening session and the market will remain volatile and will take further direction on the later half tracking the opening of the European markets. However, the domestic inflation, which is heading towards the zero level may further result in monetary easing and this will be closely observed by the investors.

On Thursday, the domestic markets opened positive however later turned volatile. The positive opening could not push the sentiments of investors as other Asian markets also traded sluggish. Enough rally in the previous sessions prompted investors to book profits at the current high level. There was no specific news to propel the market sentiments. Inflation data was very low at 0.44% as against 2.43% in the previous level. The poor inflation data showed signs of deflation and therefore nevertheless investors were pessimistic. The volatility was low in wave length and at last markets managed to close in green. Realty, IT, Teck and Oil & Gas gained by 2.48%, 1.58%, 0.83% and 0.74% respectively During the session we expect the markets to be remain volatile.

The BSE Sensex closed high by 25.07 points at 9,001.75 and NSE Nifty ended up by 12.45 points at 2,807.15. BSE Mid Caps and Small Caps ended with gains of 14.22 points and 33.05 points at 2,774.12 and 3,097.53 respectively. The BSE Sensex touched intraday high of 9,086.77 and intraday low of 8,900.39.

On Thursday, the US stock markets closed the day lower. There was mixed employment report from the government, as the Labour Department said the number of people that have lost their jobs previous week dropped by 12,000. However, the number of Americans without jobs still climbed to a record 5.5 million. US light crude oil for April delivery settled up by $3.47 to $51.61 a barrel on the New York Mercantile Exchange, the highest since 1st December. US Federal Reserve''s move to buy up to $300 bn in government securities lead the concerns of rising inflations.

The Dow Jones Industrial Average (DJIA) closed down by 85.78 points at 7,400.80, the NASDAQ Composite (RIXF) index lost 7.74 points to close at 1,483.48 and the S&P 500 (SPX) declined by 10.31 points to close at 784.04.

Today major stock markets in Asia are trading mixed. Shanghai composite is up by 6.85 points at 2,272.61 followed by South Korea''s Seoul Composite that is also up by 6.06 points at 1,167.87. Further, Hang Seng is down by143.92 points at 12,987 and Taiwan Weighted lost 28.38 points at 5,007.55. Further, Singapore''s Strait Times is down by 5.81 points at 1,579. Japanese markets are close for a holiday.

Indian ADRs ended mixed. In technology sector, Patni Computers ended higher by 1.11% along with Infosys by 2.10%. Further, Wipro gained 1.95 and Satyam closed up by 1.20%. In banking sector ICICI Bank and HDFC Bank lost 3.96% and 3% respectively. In telecommunication sector, Tata Communication dropped by 0.27% along with MTNL by 0.77%. Further, Sterlite Industries increased by 6.70%.

The FIIs on Thursday stood as net buyer in equity and net seller in debt. Gross equity purchased stood at Rs 1,807.50 Crore and gross debt purchased stood at Rs 913.10 Crore, while the gross equity sold stood at Rs 1,453.80 Crore and gross debt sold stood at Rs. 1,572 Crore. Therefore, the net investment of equity and debt reported were Rs 353.70 Crore and Rs (658.90) Crore respectively.

On Thursday, the Indian rupee closed at 51.29/30, 1.8% stronger than its previous close of 51.29/30. Rupee inclined to four months high on the back of dollar weakening against euro and the surging stock markets.

On BSE, total number of shares traded were 29.61 Crore and total turnover stood at Rs 3,977.84 Crore. On NSE, total number of shares traded were 61.05 Crore and total turnover was Rs 10,343.54 Crore.

Top traded volumes on NSE Nifty – Unitech with 33777418, Suzlon with 28805374 shares, ICICI Bank with 21624698 shares, DLF with 12604392 shares followed by SAIL with 12304015 shares.

On NSE Future and Options, total number of contracts traded in index futures was 929335 with a total turnover of Rs 12,377.20 Crore. Along with this total number of contracts traded in stock futures were 493699 with a total turnover of Rs 14,630.41 Crore. Total numbers of contracts for index options were 1449979 with a total turnover of Rs 20,393.89 Crore and total numbers of contracts for stock options were 44081 and notional turnover was Rs 1,350.70 Crore.

Today, Nifty would have a support at 2,768 and resistance at 2,862 and BSE Sensex has support at 8,823 and resistance at 9,108.