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Wednesday, July 29, 2009

Pre Session Commentary - July 29 2009


Today domestic markets are likely to open negative as majority of markets in Asia are trading in red. The US consumer confidence data tumbled for the second consecutive month causing further concerns of deteriorating demand. In the domestic arena the first quarter results from a majority of heavyweights like Tata Steel and Hero Honda would play a major role in guiding the market sentiments. Besides there is immense cautiousness prevailing amongst domestic traders ahead of the F&O expiry.

On Tuesday, domestic markets closed choppy ahead of F&O expiry. The markets opened on a subdued note ahead of the F&O expiry. Finally the much awaited RBI June quarterly review policy came with a lot of disappointment. RBI kept its key rates unchanged however asserted the fact that there is some scope for lowering interest rates. RBI forecasts the WPI inflation to remain at 5% and GDP growth rate to be at 6% during FY10. There was lot of disappointment prevailing in the market and traders were hesitating to buying at higher levels. The range bound trade finally ended flat as traders squared off their positions. From the sectoral front Realty, Auto and Metal led the markets with gains of 4.64%, 1.92% and 1.25% respectively. There was phenomenal bottom fishing once again as BSE Mid Cap and Small Cap index gained by 1.13% and 1.68% respectively. Domestic markets are likely to trade range bound today.

The BSE Sensex closed lower by 43.10 points at 15,331.94 and NSE Nifty also ended flat at 4,564.10. BSE Mid Caps and Small Caps closed up by 61.87 points and 103.07 points at 5,531.37 and 6,245.81 respectively. The BSE Sensex touched intraday high of 15,463.46 and intraday low of 15,240.53.

On Tuesday, the US stock markets closed mixed. There was lot of consolidation happening across the broader level and during the day stocks spent most of their time in the negative territory. The Consumer confidence data disappointed traders as it made its second straight decline by coming at 46.6. Retailers performed well despite of poor consumer confidence data. Health care stocks (+0.2%) outperformed the broader market for the entire session on the back of better-than-expected earnings and an upside forecast from Amgen (AMGN 62.42, +1.65) and upbeat earnings and an in-line outlook from Teva Pharmaceutical (TEVA 53.25, +2.15). Treasuries were in the limelight but the auction of $42 billion 2-year notes pulled some of early gains. The auction had a bid to cover ratio of 2.75 and fell two ticks. US light crude oil futures for September delivery closed at $67.23 per barrel down by 1.7% on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) closed lower by 11.79 points at 9,096.72, NASDAQ index inclined by 7.62 points to 1,975.51 and the S&P 500 (SPX) closed low by 2.56 points at 979.62.

Today major stock markets in Asia are trading in negative territory. Hang Seng is low by 344.74 points at 20,279.80. Shanghai Composite is low by 60.32 points at 3,378.05. Japan''s Nikkei is trading up by 5.58 points at 10,092.84. Strait Times is low by 4.12 points at 2,619.92.

Indian ADRs ended weak on Tuesday. In the banking space, ICICI Bank was down 3.25% and HDFC Bank was down 1.61%. In the telecom space, MTNL was down 2.16% and Tata Communication was down 0.05%. In the IT space, Satyam Computers was down 1.5%, Infosys was down 1.01%, Wipro was down 0.07% while Patni Computers was up 1.19%.

The FIIs on Tuesday stood as net buyers in equity and debt. Gross equity purchased stood at Rs 3,032.30 Crore, while the gross equity sold stood at Rs 2,586.10 Crore and gross debt purchased stood at Rs 553.50 Crore, while gross debt sold stood at Rs 429.80 Crore. The net investment of equity reported was Rs 446.10 Crore and net debt was Rs 123.80 Crore.

On Tuesday, the partially convertible rupee ended at Rs 48.20/21, 0.08% stronger than its previous close at 48.16/17. The rupee fell due to lack of cues from the local domestic stock markets which traded range bound.

On BSE, total number of shares traded were 50.32 Crore and total turnover stood at Rs 7,051.37 Crore. On NSE, total number of shares traded were 111.05 Crore and total turnover was Rs 22,072.74 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 134887122 shares, followed by Suzlon Energy with 43935787, DLF with 20024293, Tata Motors with 15517278 and HUL with 14579109 shares.

On NSE Future and Options, total number of contracts traded in index futures was 766690 with a total turnover of Rs 17,182.21 Crore. Along with this total number of contracts traded in stock futures were 947123 with a total turnover of Rs 29,094.10 crore. Total numbers of contracts for index options were 1238904 with a total turnover of Rs 28,401.90 Crore and total numbers of contracts for stock options were 68548 and notional turnover was Rs 2,175.98 Crore.

Today, Nifty would have a support at 4,505 and resistance at 4,648 and BSE Sensex has support at 15,195 and resistance at 15,548.