Pre Session Commentary - Apr 21 2009

Today domestic markets are likely to open with a negative gap on the back of bearish cues from the US markets that shattered badly yesterday as Bank of America reported first quarter credit loss provisions totaling $13.4 billion. Consequently the Asian markets have also opened with heavy blood bath. In the Domestic arena one may witness immense selling pressure during the first half of the trading session.

On Monday, domestic markets closed flat after last hour volatile session. Despite weak cues from the Asian markets the domestic investors showed strong buying sentiment in the first half of the trade. However the sheer profit booking pressures pulled the markets to southward. There was late buying across the bottom line stocks that helped the BSE Midcap and Smallcap steal the charm of the day’s trade. In the Sectoral indices Metal, CG, CD, Realty and Power gained by 2.53%, 1.79%, 1.65%, 1.52% and 1.33% respectively. On the other hand Bankex, FMCG and HC were the laggards. During the session we expect the markets to be trading negative.

The BSE Sensex closed with a loss of 43.59 points at 10,979.50 and NSE Nifty closed flat at 3,388.30. BSE Mid Caps and BSE Small Caps ended with gains of 56.31 points and 59.59 points at 3,528.91 and 4,011.15 respectively. The BSE Sensex touched intraday high of 11,209.66 and intraday low of 10,863.28.

On Monday, the US stock markets closed with heavy losses. Bank of America reported first quarter credit loss provisions of $13.4 billion up from almost $5 billion. There was heavy selling in the financial stocks which fell 11.4%. On the other hand Bank of America generated pretax, pre-provision of $19 billion. Diversified banks finished 15.6% lower and diversified services stocks sank 15.9%. Oracle was in the limelight after the company announced that it will acquire Sun Microsystems for $9.50 per share a premium of more than 40%. US light crude oil futures for May fell drastically by 8.8% at $45.90 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) declined by 289.60 points to close at 7,841.73. The NASDAQ Composite (RIXF) index fell by 64.86 points to close at 1,608.21 and the S&P 500 (SPX) declined by 37.21 points to close at 832.39.

Today major stock markets in Asia are trading negative. Shanghai composite is low by 31.81 points at 2,525.64. Hang Seng is trading low by 540.02 points at 15,210.89 followed by Japan''s Nikkei which is low by 259.41 points at 8,665.34, Strait Times is low by 48.20 points at 1,826.65. While Taiwan Weighted is low by 13.87 points at 5,767.79 and Seoul Composite points is low by 14.30 points at 1,322.09 respectively.

Indian ADRs ended down. In technology sector, Infosys ended lower by 3.11% along with Wipro by 5.43%. Further, Patni Computers gained 0.90% whereas Satyam closed down by 2.66%. In banking sector ICICI Bank lost 7.14% and HDFC Bank dropped by 5.93%. In telecommunication sector Tata Communication and MTNL plunged 2.74% and 2.69% respectively. Sterlite Industries decreased by 3.51%.

The FIIs on Monday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 2,547.60 Crore and gross debt purchased stood at Rs 122.60 Crore, while the gross equity sold stood at Rs 1,758.80 Crore and gross debt sold stood at Rs. 798.70 Crore. Therefore, the net investment of equity and debt reported were Rs 789.10 Crore and Rs (676.10) Crore respectively.

On Monday, the Rupee closed at Rs. 50.33/34, 0.92% weaker than its previous close of Rs. 49.87/88. The rupee traded weaker as the stock markets pared off its early gains to end flat thus creating concerns of dollar inflow.

On BSE, total number of shares traded were 43.34 Crore and total turnover stood at Rs 4,749.97 Crore. On NSE, total number of shares traded was 97.69 Crore and total turnover was Rs 14,468.76 Crore.

Top traded volumes on NSE Nifty – Unitech with 93783652 shares, Suzlon Energy with 32686716 shares, SAIL with 17685349 shares, ICICI Bank with 16516692 shares followed by DLF with 13695257 shares.

On NSE Future and Options, total number of contracts traded in index futures was 1068857 with a total turnover of Rs 17,461.91 Crore. Along with this total number of contracts traded in stock futures were 516868 with a total turnover of Rs 19,128.89 Crore. Total numbers of contracts for index options were 1557022 with a total turnover of Rs 26,750.81 Crore and total numbers of contracts for stock options were 38483 and notional turnover was Rs 1,554.68 Crore.

Today, Nifty would have a support at 3,278 and resistance at 3,321 and BSE Sensex has support at 10,670 and resistance at 10,810