Pre Session Commentary - June 19 2009

Today domestic markets are likely to open positive as majority of Asian markets have opened in green. The US jobless claim data is inline with expectations and shows a down trend. In the domestic arena inflation for the week ended June 6 slipped to negative at -1.6%, which is first time since 1977-78. There could be some buying across specific sectors which are rate sensitive as the negative inflation data gives space for further rate cut by RBI. Mid cap and Small cap stocks might be lime light today.

On Thursday, the domestic markets closed in red for the third consecutive day. After a subdued opening the markets traded lackluster during the first two hours of trade. The weak sentiments across Asian markets trapped the domestic traders as well. As the day progressed, the markets slid towards the southward with intense selling pressure on Realty, Metal, Power and CG that lost 5.80%, 4.88%, 3.83% and 3.73% respectively. Mid cap and Small cap suffered major blow as they lost 2.87% and 3.70% respectively. We expect the markets to be trading volatile.

The BSE Sensex closed with a loss of 257.31 points at 14,265.53 and NSE Nifty ended with massive loss of 104.75 points at 4,251.40. BSE Mid Caps and Small Caps closed with losses of 144.21 points and 214.10 points at 4,876.86 and 5,572.44 respectively. The BSE Sensex touched intraday high of 14,630.73 and intraday low of 14,188.25.

On Thursday, the US Markets closed mixed. The markets opened with a broad based gain as six of ten sectors in the S&P 500 posted gains. Sectors like health care, financials, utilities and consumer staples were the out performers of the day as they gained by 2.2%, 2.5%, 2.3% and 1.9% respectively. On the other hand, retailers and semiconductors were the laggards with losses of 1.3% and 1.89%. The broad-based gains came on the back of the latest jobless claims report of 608,000 initial claims which were filed for the week ending June 13. The initial claims were in line with expectations and continuing claims stood at 6.69 million. The US light crude oil for July delivery closed higher by 0.3% at $71.31 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) closed high by 58.42 points at 8,555.60 the NASDAQ Composite (RIXF) index closed flat at 1,8070.72 and the S&P 500 (SPX) closed high by 7.66 points at 918.37.

Today major stock markets in Asia are trading positive. Hang Seng is up by 87.68 points at 17,864.34. Shanghai Composite is up by 9.715 points at 2,863.618. Japan''s Nikkei is trading high by 38.28 points at 9,742. Strait Times is also up by 26.60 points at 2,263.80. KLSE Composite is low by 16.49 points at 1,054.41.

Indian ADRs ended mixed. However, losers outnumbered the gainers. In the telecom space, MTNL was down 6.71% and Tata Communication was down 2.76%. In the banking space, ICICI Bank was down 3.02% while HDFC Bank was up 2.68%. In the IT space, Wipro was down 0.43%, Patni Computers was down 0.49%, Satyam Computers was unchanged while Infosys was up 0.14%. In other sectors, Sterlite Industries was down 1.21%, while Dr Reddy''s Labs was up 1.26% and Tata Motors was up 4.15%.

The FIIs on Thursday stood as net sellers in equity and debt. The Gross equity purchased stood at Rs 2,168.30 Crore and gross debt purchased stood at Rs 189.50 Crore, while the gross equity sold stood at Rs 2,394.80 Crore and gross debt sold stood at Rs 225.20 Crore. Therefore, the net investment of equity and debt reported were Rs (226.60) Crore and Rs (35.70) Crore respectively.

On Thursday, the partially convertible rupee closed at 48.21/22 per dollar, 0.2% weaker than its previous close at 48.13/14. The local currency exuded weakness due to fall in local stock markets on the back of weak global cues.

On BSE, total number of shares traded were 50.96 Crore and total turnover stood at Rs 7,163.33 Crore. On NSE, total number of shares traded was 118.41 Crore and total turnover was Rs 20,841.04 Crore.

Top traded volumes on NSE Nifty – Unitech with 102843767 shares, Suzlon Energy with 63850054 shares, DLF with 19118791 shares, NTPC with 17986902 shares, followed by Tata Steel with 16089838 shares.

On NSE Future and Options, total number of contracts traded in index futures was 876226 with a total turnover of Rs 18,335.05 Crore. Along with this total number of contracts traded in stock futures were 478366 with a total turnover of Rs 26,529.78 Crore. Total numbers of contracts for index options were 1624557 with a total turnover of Rs 36,098.99 Crore and total numbers of contracts for stock options were 49982 and notional turnover was Rs 2,972.85 Crore.

Today, Nifty would have a support at 4,176 and resistance at 4,348 and BSE Sensex has support at 14,058 and resistance at 14,475.