Pre Session Commentary - Aug 21 2009

Today domestic markets are likely to slightly lower on mixed global cues. Asian markets are mixed today, whereas US markets ended with gains on thursday. Meanwhile, the SGX Nifty futures for August 2009 expiry was 9.5 points lower in Singapore. In the domestic arena, selling by foreign funds may fuel the sentiments. However, recovery in monsoon may bring some respite. Market is likely to remain volatile during the trading.

On Thursday, Domestic markets closed higher. The domestic market today took a sharp turn from the sharp fall yesterday, as sustained buying during the trading propelled market to end with gains. Benchmark indices surged to intraday high during final trading hours on account of upward movement in front liners led by strong European markets along with higher US index futures. Firm closing of Asian stocks also lifted the sentiments. In addition, stocks extended gains also on news that rainfall dearth has reduced a bit. India’s cumulative rainfall deficit has lessened to 27% during the period from 1 June 2009 to 18 August 2009 from 29% during the period from 1 June 2009 to 12 August 2009. Though, inflation came in negative territory for 10th consecutive week. Inflation for the week ended 8th August stood at -1.53% with the previous week''''s annual decline of -1.74%. The BSE Sensex ended above 15,000 level and NSE Nifty closed above 4,400 mark.

The BSE Sensex closed higher by 202.68 points or (1.37%) at 15,012.32 and NSE Nifty ended up by 59.35 points or (1.35%) at 4,453.45. BSE Mid Caps and Small Caps closed with gains of 43.33 and 51.88 points at 5,477.38 and 6,360.27 respectively. The BSE Sensex touched intraday high of 15,145 and intraday low of 14,928.18.

On Thursday, US stock markets closed higher for a third straight day on some positive economic data like encouraging manufacturing report. The Philadelphia Federal Reserve branch said its gauge of manufacturing activity in the region increased to 4.2 in august from minus 7.5 in July. In addition, firm overseas market also supported gains in the US market. However, market ignored disappointing jobless claims report Initial jobless claims for the week ended August 15 came in higher than expectations at 576,000 and continuing claims made a slight advance to 6.24 million due to the expiring unemployment benefits. US light crude oil futures for September delivery ended at $72.54 per barrel higher by 0.2% on the New York Mercantile Exchange. The September contract expired at settlement, with the bulk of trading revolving around October futures, which settled 92 cents, or 1.3%, lower at $72.91 a barrel.

The Dow Jones Industrial Average (DJIA) closed higher by 70.89 points at 9,350.05, NASDAQ index inclined by 19.98 points to 1,989.22 and the S&P 500 (SPX) closed higher by 10.91 points at 1,007.37.

Today major stock markets in Asia are trading mixed. Taiwan Weighted is trading up by 21.16 points at 2,932.74 followed by Seoul Composite, which is trading higher by 0.42 points at 1,576.81. However, Japan''s Nikkei is trading lower by 172.10 points at 10,211.31. Hang Seng is also down by 118.62 points at 20,210.64. Strait Times is down by 18.42 points at 2,541.15.

Indian ADRs ended in green on Thursday. In the IT space, Wipro was up 1.89%, Satyam Computers was up 1.69%, Infosys was up 0.37% while Patni Computers ended down 1.21%. In the banking space, HDFC Bank was up 2.5% and ICICI Bank was up 1.85%. In the telecom space, MTNL was up 1.84% and Tata Communication was up 0.91%. In other sectors, Sterlite Industries was up 3.46%, Tata Motors was up 1.66% and Dr Reddy''s Labs was up 0.25%.

The FIIs on Thursday stood as net sellers in equity and net buyers in debt. Gross equity purchased stood at Rs 2,288.70 Crore and gross debt purchased stood at Rs 75.00 Crore, while the gross equity sold stood at Rs 3,160.80 Crore and gross debt sold stood at Rs 0.00 Crore. Therefore, the net investment of equity and debt reported were Rs (872.10) Crore and Rs 75.00 Crore respectively.

On Thursday, Indian Rupee closed at 48.71/72 per dollar, 0.1% stronger than previous close of 48.78/79. The rupee gained strength as stock markets rebound from yesterday’s losses increasing expectations of foreign capital inflow.

On BSE, total number of shares traded were 41.13 Crore and total turnover stood at Rs 4,863.43 Crore. On NSE, total number of shares traded were 80.07 Crore and total turnover was Rs 13,245.55 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 30768297 shares, followed by Suzlon Energy with 29444298, Idea Cellular with 13713553, Hindalco with 8391589 and Ambuja Cements with 6721671 shares.

On NSE Future and Options, total number of contracts traded in index futures was 693849 with a total turnover of Rs 14,742.23 Crore. Along with this total number of contracts traded in stock futures were 491920 with a total turnover of Rs 15,139.69 crore. Total numbers of contracts for index options were 1360598 with a total turnover of Rs 30687.92 Crore and total numbers of contracts for stock options were 42555 and notional turnover was Rs 1,313.11 Crore.

Today, Nifty would have a support at 4,362 and resistance at 4,531 and BSE Sensex has support at 14,688 and resistance at 15,286.