Pre Session Commentary - May 19 2009

Today domestic markets are likely to open with a whopping gap on the back of the stable government euphoria that had yesterday helped benchmark indices make epoch making single day gain in the history of stocks trading. The sentiments are still unearthed as majority of retail and institutional investors could not participate the rally due to market freeze. The SGX Nifty is trading up above 5% and the other Asian markets have opened with phenomenal gains. One could witness huge buying pressure during the first half of the trading session amidst relentless euphoria prevailing across the nation.

Monday, the domestic markets were bombarded by traders registering massive gains in during the first half session to close with buying freeze. The staggering win of congress with a record 206 seats has brought euphoria across the globe, inspiring investors to take fresh positions on the hope of stable government for the next five years. Sentiments were stronger than expected and therefore sensitive sectors like Realty, CG, Bankex and Oil closed with huge gains of 23.45%, 21.90%, 19.18% and 19.11% respectively. Sensex and Nifty breached 14k and 4k mark. We expect the markets to be trading with huge buying pressure.

The BSE Sensex closed high by a massive 2,110.79 points at 14,284.21 and NSE Nifty ended with mammoth of 651.50 points at 4,323.15. BSE Mid Caps and Small Caps closed with gains of 447.41 points and 387.14 points at 4,254.48 and 4,666.74 respectively. The BSE Sensex touched intraday high of 14,284.21 and intraday low of 13,479.39.

On Monday, the US stock markets closed in green. Finally after four consecutive falls the markets resurged to trade in green on the back of banking and financial services stocks. The session exuded firm trend due to overwhelming buying sentiments across the financial stocks at broader level. Bank of America was a pioneer in leading the gain as Goldman Sachs has added shares of the bank to their conviction buy list. Diversified banks jumped 8.5% followed by diversified financial services companies that advanced by a remarkable 7.6%. The April housing to be released today would further test the patientance of traders. The US light crude oil futures for June closed higher by 4.8% at $59.03 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) inclined by 235.44 points to close at 8,504.08 The NASDAQ Composite (RIXF) index inclined by 52.22 points to close at 1,732.36 and the S&P 500 (SPX) closed up by 26.83 points at 909.71.

Today major stock markets in Asia are trading in green. Hang Seng is trading up by 412.12 points at 17,435.03 followed by Shanghai Composite which is up by 26.76 points at 2,679.54. Japan''s Nikkei is also up by 254.40 points at 9,293.09, Strait Times is up by 77.31 points at 2,254.29. Seoul Composite rose by 31.84 points at 1,418.52 respectively.

Indian ADRs ended higher. In technology sector, Infosys ended up by 8.99% along with Wipro by 7.48%. Further, Satyam gained 18.23% and Patni Computers ended higher by 9.26%. In banking sector ICICI Bank advanced by 25.22% and HDFC Bank went up by 21.29%. In telecommunication sector Tata Communication increased by 27.62% and MTNL surged 25.17%. Sterlite Industries increased by 26.03%.

The FIIs on Monday stood as net buyers in equity and debt. Gross equity purchased stood at Rs 2,673.00 Crore and gross debt purchased stood at Rs 94.50 Crore, while the gross equity sold stood at Rs 1,672.80 Crore and gross debt sold stood at Rs. 26.30 Crore. Therefore, the net investment of equity and debt reported were Rs 1,000.20 Crore and Rs 68.20 Crore respectively.

On Monday, the partially convertible rupee ended at 47.88/90 per dollar, 3.2 percent stronger than previous close at 49.41/42. Rupee gained strength due to the Congress Party and its alliance (UPA) win a majority during the 14th Lok Sabha Election. There was mammoth rise in the benchmark indices of local stock markets increasing expectations of green back inflow.

On BSE, total number of shares traded were 1.33 Crore and total turnover stood at Rs 127.00 Crore. On NSE, total number of shares traded was 84.30 Crore and total turnover was Rs 170.32 Crore.

Top traded volumes on NSE Nifty – Unitech with 439987 shares, Suzlon Energy with 275415 shares, Reliance Petro 177989 shares, ITC with 152364 shares followed by DLF with 130572 shares.

On NSE Future and Options, total number of contracts traded in index futures was 65288 with a total turnover of Rs 1,372.38 Crore. Along with this total number of contracts traded in stock futures were 12467 with a total turnover of Rs 611.51 Crore. Total numbers of contracts for index options were 31003 with a total turnover of Rs 599.21 Crore and total numbers of contracts for stock options were 360 and notional turnover was Rs 16.24 Crore.

Today, Nifty would have a support at 4,589 and resistance at 4,682 and BSE Sensex has support at 14,856 and resistance at 15,250.