Pre Session Commentary - Aug 11 2009

Today domestic markets are likely have gap down opening on the back of weak global cues as US markets closed lower on Monday. However, Asian markets are trading mixed in early trading. Additionally, lower than normal monsoon rains and spread of the deadly swine flu in the country will also fuel the sentiments. Domestic stockss may witness volatility during the trading.

On Monday, Market belled the day on positive note backed by the firm cues from the US and Asian markets. The US stocks markets closed higher on Friday by logging impressive gains for the week due to the better-than-expected jobs report. Moreover, US jobs report revealed that fewest amount of job losses in nearly one year by coming in at 247,000 for July as against the consensus estimate called for 350,000 job losses. Further, Indian benchmark indices turned volatile soon after start and pared all initial gains. However, market managed to regain strength and moved into positive before losing strength yet again. Going ahead, stocks continued to swing between positive and negative terrain without any sign of recovery. During the final trading hours, market slipped sharply to close with losses on weak European markets. Investors’ were also worried on lesser than normal rain that may interrupt a hopeful revival in the domestic economy. From the sectoral front, most of the selling was observed in Auto, FMCG, Capital Goods, Realty, PSU, Power and Bank stocks. The border market indices also followed the same trend as BSE Midcap and Smallcap indices ended with losses of more than 2% each. However, IT and Teck stocks remained in limelight as witnessed most of the buying from these baskets.

The BSE Sensex closed lower by 150.47 points or (0.99%) at 15,009.77 and NSE Nifty ended down by 43.75 points or (0.98%) at 4,437.65. BSE Mid Caps and Small Caps closed with losses of 92.77 and 120.73 points at 5,340.48 and 6,073.03 respectively. The BSE Sensex touched intraday high of 15,417.34 and intraday low of 14,902.02.

On Monday, US stock markets closed lower on profit booking after a four-week rally. Stocks slipped also ahead of vital economic data, including Federal Reserve''s statement on interest rates, due this week. Market was choppy during the trading in the absence of market-moving earnings announcements and no economic data. US light crude oil futures for September delivery closed at $70.62 per barrel lower by 0.4% on the New York Mercantile Exchange. Oil prices fell ahead of this week''s U.S. consumer spending data that could shed light on the strength of the economic recovery.

The Dow Jones Industrial Average (DJIA) closed lower by 32.12 points at 9,337.95, NASDAQ index declined by 8.01 points to 1,992.24 and the S&P 500 (SPX) closed lower by 3.38 points at 1,007.10.

Today major stock markets in Asia are trading mixed. Shanghai Composite is up by 2.11 points at 3,251.87. Japan''s Nikkei is trading high by 20.67 points at 10,544.93 followed by Strait Times and Seoul Composite up by 36.15 and 0.33 points at 2,585.50 and 1,576.44 respectively. However, Hang Seng is down by 51.81 points at 20,877.71 and Taiwan Weighted is low by 59.59 points at 6,823.28.

Indian ADRs ended mixed on Monday. However, losers outnumbered the gainers. In the banking space, ICICI Bank was down 5.91% and HDFC Bank was down 3.01%. In the telecom space, MTNL was down 5.71% and Tata Communication was down 2.57%. In the IT space, Infosys was down 1.03%, Satyam Computers was down 0.54% while Wipro was up 1.89% and Patni Computers was up 3.54%. In other sectors, Dr Reddy''s Labs was down 3.75%, Tata Motors was down 2.46% and Sterlite Industries was down 2.25%.

The FIIs on Monday stood as net sellers in equity and debt. Gross equity purchased stood at Rs 2,141.80 Crore, while the gross equity sold stood at Rs 2,987.90 Crore and gross debt purchased stood at Rs 463.40 Crore, while gross debt sold stood at Rs 699.60 Crore. The net investment of equity reported was Rs (846.10) Crore and net debt was Rs (236.30) Crore.

On Monday, the partially convertible rupee ended at 47.81/82, 0.08% stronger than its previous close at 47.85/86. Expectations of inflows from institutional share placements helped rupee gain strength.

On BSE, total number of shares traded were 38.90 Crore and total turnover stood at Rs 5,536.76 Crore. On NSE, total number of shares traded were 84.85 Crore and total turnover was Rs 17,133.82 Crore.

Top traded volumes on NSE Nifty – Suzlon Energy with total volume traded 63215845 shares, followed by Unitech with 52117641, Bharti Airtel with 15902099, Hindalco with 12831031 and Tata Steel with 11816809 shares.

On NSE Future and Options, total number of contracts traded in index futures was 877483 with a total turnover of Rs 18,656.28 Crore. Along with this total number of contracts traded in stock futures were 535813 with a total turnover of Rs 16,498.55 crore. Total numbers of contracts for index options were 1379213 with a total turnover of Rs 31,772.73 Crore and total numbers of contracts for stock options were 49937 and notional turnover was Rs 1,565.92 Crore.

Today, Nifty would have a support at 4,352 and resistance at 4,524 and BSE Sensex has support at 14,719 and resistance at 15,294.