Pre Session Commentary - July 3 2009

Today domestic markets are likely to open negative as the US markets have closed with huge losses on the back of disappointing Non-Farm unemployment data. The Asian markets have also opened with blood bath exuding signs of weakness at broader level. In the domestic arena the Railway budget to be announced today will be the head line in news and traders would take safer positions ahead of the Union Budget to be announced on Monday July 6.

On Thursday, domestic markets closed flat. The trading started with a subdued note on mixed cues from Asian markets as well as due to cautiousness amongst local traders ahead of the Union Budget due on Monday, July 6. The Economic survey that called for sweep reforms hardly pumped the traders’ sentiments. There was lack of buying effort across the broader level as investors are desperately waiting for the real budget stimulus. The weak opening of the European markets further pulled the market sentiments as the domestic benchmark indices kept gyrating throughout the day. Sectors like Metal, PSU, Realty and HC gained by 3.26%, 1.95%, 1.55% and 0.84% respectively. BSE Midcap and Smallcap managed to close with gains of 0.33% and 0.74% respectively. There could be a range bound trade today with negative bias.

The BSE Sensex closed up by 13.02 points at 14,658.49 and NSE Nifty ended up by 7.95 points at 4,348.85. BSE Mid Caps closed with gains of 16.76 points and 42.82 points at 5,144.27 and 5,800.24 respectively. The BSE Sensex touched intraday high of 14,764.35 and intraday low of 14,469.69.

On Thursday, the US Markets ended with huge losses on the back of worse than expected Non-farm payroll job losses. The session started with stocks diving sharply lower amidst expectations of disappointing jobs report. The selling pressure erupted after the news of the June Nonfarm Payrolls report, which indicated that 467,000 jobs were lost in the month. The number was very huge as against the May job losses of 322,000 and much beyond the expected 365,000 losses. The national unemployment data stands at 9.5% parallel with the expected 9.6%.On the other hand May factory orders inclined by a surprising 1.2% better than the expected 0.9%. The employment data shadowed the May factory orders news and therefore sellers became emboldened till the end of the trading session. The S&P 500 plummeted below the psychological number of 900 level. US light crude oil for August Futures delivery declined by 3.7% at $66.73 per barrel on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) slipped by a drastic 218.94 points at 8,285.12 the NASDAQ Composite (RIXF) index lost 49.20 points at 1,796.52 and the S&P 500 (SPX) declined by 26.18 points at 897.15.

Today major stock markets in Asia are trading in negative. Hang Seng is low by 97.53 points at 18,080.52. Shanghai Composite is up by 8.04 points at 3,068.298. Japan''s Nikkei is trading down by 122.45 points at 9,753.70. Strait Times is low by 20.48 points at 2,300.34. Seoul Composite is low by 5.65 points at 1,405.83 and KLSE Composite is flat at 1,078.71.

Indian ADRs ended in red on Thursday. In the IT space, Infosys was down 3%, Patni Computers was down 3.07% while Satyam Computers was up 2.77% and Wipro ended up 0.43%.In the banking space, ICICI Bank was down 2.86% and HDFC Bank was down 2.07%. In the telecom space, Tata Communication was down 2.82% and MTNL was down 2.04%. In other sectors, Tata Motors was down 2.82%, Dr Reddy''s Labs was down 1.17% while Sterlite Industries was up 0.47%.

The FIIs on Thursday stood as net buyers in equity and debt. The Gross equity purchased stood at Rs 1,448.60 Crore and gross debt purchased stood at Rs 225.80 Crore, while the gross equity sold stood at Rs 1,284.90 Crore and gross debt sold stood at Rs 41.40 Crore. Therefore, the net investment of equity and debt reported were Rs 163.70 Crore and Rs 184.30 Crore respectively.

On Thursday, the partially convertible rupee ended at Rs 47.94/95, 5 paise weaker as compared to its previous close at 47.89/90. The green back has showed a relative strength as other currencies across the world.

On BSE, total number of shares traded were 37.35 Crore and total turnover stood at Rs 5,990.73 Crore. On NSE, total number of shares traded was 84.80 Crore and total turnover was Rs 17,751.14 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 44874603, followed by Suzlon Energy with 41203690, Tata Steel with 17134163, DLF with 15020544 and SAIL with 11287767.

On NSE Future and Options, total number of contracts traded in index futures was 760367 with a total turnover of Rs 15,808.29 Crore. Along with this total number of contracts traded in stock futures were 590708 with a total turnover of Rs 17,099.03 Crore. Total numbers of contracts for index options were 839717 with a total turnover of Rs 18,779.7 Crore and total numbers of contracts for stock options were 38600 and notional turnover was Rs 1,231.53 Crore.

Today, Nifty would have a support at 4,276 and resistance at 4,382 and BSE Sensex has support at 14,415 and resistance at 14,812.