Pre Session Commentary - May 14 2009

Today domestic markets are likely to open negative as there are severe negative cues from across other markets of the world. US markets lost huge numbers on the back of poor retail figures for the month of April thus causing ripple effect on the Asian markets’ opening. On the domestic arena yesterday’s negative closing also exudes traders’ cautiousness and therefore one may witness intense selling pressures ahead of the Lok Sabha election results.

On Wednesday, the domestic markets closed in red after a volatile session. After a subdued opening the markets traded lethargic due to lack of cues from other markets. After a huge gain in yesterday’s trade traders booked some profits today. Hedge funds resorted to basket selling towards the later part of the session and therefore markets plunged at the end. Metal, IT, FMCG and PSU lost 2.07%, 1.56%, 1.54% and 1.47% respectively. Mid and Small cap stocks managed to escape the late selling pressure as they closed with marginal losses of 0.13% and 0.48% respectively. We expect the markets to be trading in deep red.

The BSE Sensex closed low by 138.38 points at 12,019.65 and NSE Nifty ended with loss of 45.85 points at 3,635.25. BSE Mid Caps and Small Caps closed with losses of 4.79 points and 20.50 points at 3,741.45 and 4,220.21 respectively. The BSE Sensex touched intraday high of 12,256.43 and intraday low of 11,934.44.

On Wednesday, the US stock markets closed negative. The unexpected decline in advance retail data announced ahead of the opening bell pulled the sentiments of traders resulting in intense selling. April total retail sales decreased 0.4%, and sales less autos decreased 0.5%. The April figures failed to meet the consensus forecast, which called for total sales to be flat and sales excluding autos to increase 0.2%. Retail giant Wal-Mart was also shattered as the retail sector slid by 3.3%.Hoewever its was Financial sectors that conceded a loss of 5.2%. US light crude oil futures for June closed lower by 1.4% at $58.02 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) fell by 184.22 points to close at 8,284.89 The NASDAQ Composite (RIXF) index declined by 51.73 points to close at 1,664.19 and the S&P 500 (SPX) closed low by 24.43 points at 883.92.

Today major stock markets in Asia are trading in deep red. Hang Seng is trading low by 593.87 points at 16,465.75 followed by Shanghai Composite which is low by 48.93 points at 2,614.28. Japan''s Nikkei is low by 272.82 points at 9,067.67, Strait Times is low by 57.65 points at 2,127.64. Seoul Composite is low by 31.45 points at 1,383.07 respectively.

Indian ADRs ended lower. In technology sector, Infosys ended down by 4.68% along with Wipro by 3.99%. Further, Satyam lost 4.28% whereas Patni Computers gained 0.50%. In banking sector ICICI Bank lost 6.71% and HDFC Bank dropped by 6.23%. In telecommunication sector Tata Communication decreased by 3.52% while MTNL gained 1.40%. Sterlite Industries decreased by 6.03%.

The FIIs on Wednesday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 2,542.50 Crore and gross debt purchased stood at Rs 471.30 Crore, while the gross equity sold stood at Rs 2,048.70 Crore and gross debt sold stood at Rs. 805.80 Crore. Therefore, the net investment of equity and debt reported were Rs 493.80 Crore and Rs (334.50) Crore respectively.

On Wednesday, the partially convertible rupee ended at 49.30/31 per dollar, 40 paise weaker than previous close at 49.30/31. Rupee lost strength due to fall in local stock markets.

On BSE, total number of shares traded were 42.31 Crore and total turnover stood at Rs 4,943.62 Crore. On NSE, total number of shares traded was 97.94 Crore and total turnover was Rs 16,109.73 Crore.

Top traded volumes on NSE Nifty – Suzlon Energy with 85998220 shares, Unitech with 73790072 shares, DLF with 27280135 shares, ICICI Bank 16308825 shares followed by Tata Steel with 15241445 shares.

On NSE Future and Options, total number of contracts traded in index futures was 1080708 with a total turnover of Rs 18,835.95 Crore. Along with this total number of contracts traded in stock futures were 476617 with a total turnover of Rs 19,943.28 Crore. Total numbers of contracts for index options were 1271496 with a total turnover of Rs 23768.35 Crore and total numbers of contracts for stock options were 33193 and notional turnover was Rs 1,487.53 Crore.

Today, Nifty would have a support at 3,520 and resistance at 3,585 and BSE Sensex has support at 11,595 and resistance at 11,875.