Pre Session Commentary - May 6 2009

Today domestic markets are likely to open positive as majority of Asian markets have opened in green despite flat closing of US markets. The sentiments in domestic arena would once again lament due to lack of any major news. One could expect another volatile session today amidst cautious trading. Further movements of the Asian markets would depend on the opening of the European markets.

On Tuesday, domestic markets closed flat after a volatile trade. Since the beginning of the day’s trade, lack of news and any cues from the Asian & European markets was evident. The trade was of low intensity and traders were cautious about their new positions. As the pending home sales data in US recorded better than expected growth of 3.2%, domestic Realty sector was the star performer of the day’s trade with a phenomenal gain of 8.63%. Stocks like DLF and Unitech were in the lime light recording exemplary gains of 11.36% and 10.66% to close at Rs. 260.30 and Rs. 54.50 respectively. Metal, Bankex, CG and Power stocks also managed recorded gains of 3.5%, 2.36%, 1.77% and 1.19% respectively. However amidst lack of news, bottom line stocks stole the charm of the day. We expect the markets to be trading positive with an essence of volatility.

The BSE Sensex closed flat at 12,131.08 and NSE Nifty ended up by 7.90 points at 3,661.90. BSE Mid Caps and Small Caps closed with gains of 67.58 points and 80.88 points at 3,718.87 and 4,162.58 respectively. The BSE Sensex touched intraday high of 12,197.88 and intraday low of 11,985.88.

On Tuesday, the US stock markets closed in red. The statement from Ben Bernanke prompted investors to book profits rather than carry forward yesterday’s rally. The Fed chairman Ben Bernanke has stated to the Joint Economic Committee that the recent data suggest that the pace of contraction may be slowing however the economic activity is likely to bottom out instead of moving up this year. Bernanke''s statement was further supported by the April ISM Service Index. Showing continued contraction, the Index came in at 43.7, but that was better than expected and up from the prior reading. Besides the Financial stocks, Energy stocks also fell due to fall in crude oil prices. US light crude oil futures for June declined by 1.2% at $53.80 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) declined by 16.09 points to close at 8,410.65 The NASDAQ Composite (RIXF) index fell by 9.44 points to close at 1,754.12 and the S&P 500 (SPX) declined by 3.44 points to close at 903.80.
Today major stock markets in Asia are trading positive. Hang Seng is trading up by 54.18 points at 16,484.26 followed by, Strait Times which is low by 9.11 points at 2,055.11.

Indian ADRs ended mixed. In technology sector, Infosys ended down by 1.04% along with Satyam by 0.56%. Further, Wipro gained 2.73% whereas Patni Computers closed down by 0.12%. In banking sector ICICI Bank gained 1.62% while HDFC Bank dropped by 2.18%. In telecommunication sector Tata Communication gained 0.13% and MTNL increased by 3.32%. Sterlite Industries decreased by 3.15%.
The FIIs on Tuesday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 3,852.80 Crore and gross debt purchased stood at Rs 56.20 Crore, while the gross equity sold stood at Rs 2,361.60 Crore and gross debt sold stood at Rs. 410.30 Crore. Therefore, the net investment of equity and debt reported were Rs 1,491.10 Crore and Rs (354.10) Crore respectively.

On BSE, total number of shares traded were 57.10 Crore and total turnover stood at Rs 5,831.59 Crore. On NSE, total number of shares traded was 119.86 Crore and total turnover was Rs 18,476.81 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 134753965 shares, followed by Suzlon Energy with 70788494 shares, DLF with 27798838 shares, ICICI Bank 23161116 shares and Tata Steel with 16763994 shares respectively.

On NSE Future and Options, total number of contracts traded in index futures was 832620 with a total turnover of Rs 14,657.83 Crore. Along with this total number of contracts traded in stock futures were 522332 with a total turnover of Rs 21,603.51 Crore. Total numbers of contracts for index options were 793635 with a total turnover of Rs 14,943.84 Crore and total numbers of contracts for stock options were 34288 and notional turnover was Rs 1,506.98 Crore.

Today, Nifty would have a support at 3,600 and resistance at 3,695 and BSE Sensex has support at 12,015 and resistance at 12,210.