Pre Session Commentary - June 9 2009

Today domestic markets are likely to open negative as majority of Asian markets are trading in the southward. The US markets closed flat due to lack of any specific news and in the domestic arena one could see a flat trade though there could be some bounce back. On a broader level the mid cap and small cap stocks may bounce back with higher intensity and stock specific movement could rise during the day’s trade.

On Monday, the domestic markets closed with huge losses. The opening was weak and subdued due to lack of any specific news. And as the day progressed profit booking pressured in Realty, Metal and Banking stocks pulled the benchmark towards the southward. The negative opening of the European market further added fuel to the fire of selling pressures. Heavy profit booking erupted across the broader level and traders capitalized on the peak prices. Sectors like Realty, Metal and Bankex eroded by 10.54%, 6.51%, 4.42% and 4.41% respectively. On the other hand, Mid cap and Small cap stocks were the worst hit as the indices lost 5.45% and 5.80% respectively. We expect the markets to be trading range bound.

The BSE Sensex closed with loss of 437.63 points at 14,665.92 and NSE Nifty ended low by 157 points at 4,429.90. BSE Mid Caps and Small Caps closed with losses of 294.93 points and 374.77 points at 5,114.85 and 6,083.88 respectively. The BSE Sensex touched intraday high of 15,200.82 and intraday low of 14,604.23.

On Monday, the US Markets closed flat. Due to lack of any specific news, the markets pared off it previous week’s gains however due to late squeeze mainly the financials, the major indices closed flat. The cautiousness across the broader level has happened due to stocks rallying more than 40% from their March lows amid better-than-feared data, but could not hold on the gain of Friday despite encouraging jobs report. The financial stocks were in the limelight ahead of the Fed''s official announcement regarding which companies will be allowed to repay TARP funds. As per the recent data the Fed has allowed 10 banks to raise capital. The US light crude oil for July delivery closed marginally lower at $68.428 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) closed flat at 8,764.49 the NASDAQ Composite (RIXF) index declined by 7.02 points to close at 1,842.40 and the S&P 500 (SPX) closed flat at 939.14.

Indian ADRs ended mostly lower. In the telecom space, MTNL was down 7.26% and Tata Communication was down 5.1%. In the banking space, ICICI Bank was down 4.02% and HDFC Bank was down 3.1%. In the IT space, Wipro was down 1.37%, Patni Computers was down 3.6% while Infosys ended up 0.5% and Satyam Computers ended up 0.37%. In other sectors, Sterlite Industries ended down 2.96%, Tata Motors was down 0.19% while Dr Reddy''s Labs was up 0.35%.

Today major stock markets in Asia are trading negative. Hang Seng is low by 342.48 points at 17,910.91. Shanghai Composite is low by 28.39 points at 2,739.95. Japan''s Nikkei is trading low by 73.05 points at 9,792.58. Strait Times is also low by 11.13 points at 2,322.57. KLSE Composite is low by 2.65 points at 1,072.85.

On Monday, the partially convertible rupee closed at 47.555/565 per dollar, 1% weaker than it previous close at 47.11/12. The rupee lost grounds due to huge correction in local stock markets.

On BSE, total number of shares traded were 66.05 Crore and total turnover stood at Rs 7,357.83 Crore. On NSE, total number of shares traded was 130.94 Crore and total turnover was Rs 21,307.08 Crore.

Top traded volumes on NSE Nifty – Unitech with 103987893 shares, Suzlon Energy with 80152063 shares, ITC with 15603937 shares, Tata Steel with 13907187 shares, followed by DLF with 12647207 shares.

On NSE Future and Options, total number of contracts traded in index futures was 725743 with a total turnover of Rs 15,691.34 Crore. Along with this total number of contracts traded in stock futures were 418551 with a total turnover of Rs 24,955.67 Crore. Total numbers of contracts for index options were 1004277 with a total turnover of Rs 23,129.45 Crore and total numbers of contracts for stock options were 34005 and notional turnover was Rs 2,100.65 Crore.

Today, Nifty would have a support at 4,479 and resistance at 4,310 and BSE Sensex has support at 14,495 and resistance at 14,825.