Pre Session Commentary - Aug 14 2009

Today domestic markets are likely to open positive as there is moderate buying sentiments prevailing across broader level. The US markets closed with minimal gains due to disappointing macro economic data however the resurgence of European economy is likely to bring a lot of confidence across Asian markets. Today one could expect a range bound trade with positive bias.

On Thursday, Domestic markets closed with staggering gains. Market rallied sharply following firm European markets along with positive US index futures and higher Asian stocks. Further, strong industrial production (IIP) also boosted investor’s sentiments, which expanded 7.8% in June 2009, at the fastest pace in 16 months. The draft direct tax code, which proposes to reduce tax rates on individual and corporate and scrapping of the Securities Transaction Tax (STT) also contributed to the upward movement across the board. Meanwhile, inflation fell to the lowest in three decades to (-) 1.74% for the week ended 1st August 2009. During final trading hours, market gained further grounds and concluded its upward journey with strong gains. From the sectoral front Realty, Metal, Bank, Auto, Capital Goods, FMCG, PSU and Power witnessed most of the buying from these baskets.

The BSE Sensex closed higher by 498.33 points or (3.32%) at 15,518.49 and NSE Nifty ended up by 147.50 points or (3.31%) at 4,605. BSE Mid Caps and Small Caps closed with gains of 194.36 and 252.12 points at 5,608.89 and 6,387.05 respectively. The BSE Sensex touched intraday high of 15,545.13 and intraday low of 15,207.96.

On Thursday, US stock markets closed higher. There was lot of optimism and strong buying sentiment during the opening bell as German and French economies both exceeded expectations by posting second quarter growth of 0.3%. However array of bad US economic news tarnished the shine of stocks. Total retail sales for July made an unexpected 0.1% decline and sales less autos fell a sharper-than-expected 0.6%. Initial jobless claims were also higher than expected at 558,000 and propelled the 4-week moving average up to 565,000 from 556,500. Meanwhile, continuing claims made a larger-than-expected retreat to 6.20 million, but the drop is most likely from unemployed workers losing their benefits. US light crude oil futures for September delivery closed at $70.65 per barrel higher by 0.7% on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) closed higher by 36.58 points at 9,398.19, NASDAQ index inclined by 10.63 points to 2,009.35 and the S&P 500 (SPX) closed higher by 6.92 points at 1012.75.

Today major stock markets in Asia are trading mixed. Shanghai Composite is low by 74.47 points at 3,066.92. Japan''s Nikkei is trading up by 60.46 points at 10,577.65 followed by Strait Times which is trading lower by 0.26 points at 2,613.92 and Seoul Composite is trading higher by 15.97 points at 1,580.61. Hang Seng is trading low by 190.63 points at 20,670.67.

Indian ADRs ended mostly up on Thursday. In the banking space, ICICI Bank was up 4.14% and HDFC Bank was up 2.01%. In the telecom space, Tata Communication was up 3.69% and MTNL was up 1.48%. In the IT space, Satyam Computers was up 2.94%, Patni Computers was up 3.26%, Wipro was up 0.9% while Infosys was down 0.37%. In other sectors, Sterlite Industries was up 4.41%, Tata Motors was up 3.2% while Dr Reddy''s Labs was down 0.06%.

The FIIs on Thursday stood as net sellers in equity and debt. Gross equity purchased stood at Rs 2,595.00 Crore, while the gross equity sold stood at Rs 2,705.50 Crore and gross debt purchased stood at Rs 119.60 Crore, while gross debt sold stood at Rs 285.50 Crore. The net investment of equity reported was Rs (110.50) Crore and net debt was Rs (165.80) Crore.

On BSE, total number of shares traded were 48.06 Crore and total turnover stood at Rs 6,105.39 Crore. On NSE, total number of shares traded were 96.66 Crore and total turnover was Rs 17,892.37 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 60974334 shares, followed by Suzlon Energy with 46635075, DLF with 13008636, Hindalco with 11631313 and Tata Steel with 10466794 shares.

On NSE Future and Options, total number of contracts traded in index futures was 704015 with a total turnover of Rs 15,182.35 Crore. Along with this total number of contracts traded in stock futures were 596910 with a total turnover of Rs 18,937.86 crore. Total numbers of contracts for index options were 1283432 with a total turnover of Rs 29,578.09 Crore and total numbers of contracts for stock options were 57906 and notional turnover was Rs 1,853.89 Crore.

Today, Nifty would have a support at 4,568 and resistance at 4,655 and BSE Sensex has support at 15,425 and resistance at 15,675.