Pre Session Commentary - Aug 7 2009

Today domestic markets are likely to open negative as there are bearish sentiments prevailing across other markets. The US markets closed lower after unimpressive July same stores data. There is hardly any guidance from other markets and therefore one could witness some consolidation happening across domestic markets as well. Markets are likely to trade range bound today.

On Thursday, Domestic markets opened on downbeat note tracking weak cues from global markets. The US stocks markets closed lower on Wednesday following some weaker-than-expected economic reports. The ISM services index for July unexpectedly slipped to 46.4 from 47 in June. Besides, the latest ADP employment report in US indicated that 3.71 lakh jobs were slashed in July. Further, benchmark indices continued to trade weak amid volatility on sustained selling over the counters. However, market managed to gain some ground during afternoon trade tracking gains in European stocks, before slipping again. Going ahead, stocks extended losses and nosedived during final trading backed by strong selling pressure. From the sectoral front, investors off-loaded positions across the sectors. Besides, most of the selling was witnessed in Auto, Realty, Metal, FMCG, Power, Consumer Durables, Capital Goods and IT stocks. BSE Midcap and Smallcap indices also remained under pressure.

The BSE Sensex closed lower by 389.80 points or (2.45%) at 15,514.03 and NSE Nifty ended down by 108.65 points or (2.31%) at 4,585.50. BSE Mid Caps and Small Caps closed with losses of 136.07 and 82.59 points at 5,559.26 and 6,314.79 respectively. The BSE Sensex touched intraday high of 15,969.81 and intraday low of 15,443.22.

On Thursday, US stock markets closed lower. Markets opened with solid gains however the unimpressive data of July same store sales pulled the market sentiments. On the other hand, the smaller-than-expected weekly initial jobless claims tally of 550,000 was positive driving news for the traders. Meanwhile the continuing claims were more-than-expected at 6.31 million, up from the previous week. Traders are also waiting for the Non-farm payrolls data for the month of July that is due to be declared today before the opening bell. In sector specific Financials which were logging gains for the past five consecutive sessions ended with losses of 0.7%. US light crude oil futures for September delivery closed at $71.94 per barrel lower by 0.1% on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) closed lower by 24.71 points at 9,256.26, NASDAQ index declined by 19.89 points to 1,973.16 and the S&P 500 (SPX) closed lower by 5.64 points at 997.08.

Indian ADRs ended in red on Thursday. In the IT space, Satyam Computers was down 6.05%, Infosys was down 2.14%, Patni Computers was down 2.97% and Wipro was down 0.85%. In the banking space, HDFC Bank was down 2.67% and ICICI Bank was down 1.7%. In the telecom space, MTNL was down 2.12% and Tata Communication was down 0.83%. In other sectors, Sterlite Industries was down 5.11%, Dr Reddy''s Labs was down 3.76% and Tata Motors was down 2.84%.

The FIIs on Thursday stood as net sellers in equity and net buyers in debt. Gross equity purchased stood at Rs 1,948.90 Crore, while the gross equity sold stood at Rs 2,429.40 Crore and gross debt purchased stood at Rs 196.90 Crore, while gross debt sold stood at Rs 71.40 Crore. The net investment of equity reported was Rs (480.40) Crore and net debt was Rs 125.50 Crore.

On Thursday, the partially convertible rupee ended at Rs 47.68/69, 0.3% weaker than its previous close at 47.52/53. The rupee lost grounds due to drastic fall in local stock markets.

On BSE, total number of shares traded were 56.78 Crore and total turnover stood at Rs 7,169.11 Crore. On NSE, total number of shares traded were 113.30 Crore and total turnover was Rs 21,070 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 65119620 shares, followed by Suzlon Energy with 35254386, Hindalco with 15388145, DLF with 14618793 and ICICI Bank with 13908696 shares.

On NSE Future and Options, total number of contracts traded in index futures was 959421 with a total turnover of Rs 21,171.56 Crore. Along with this total number of contracts traded in stock futures were 670402 with a total turnover of Rs 21,194.51 crore. Total numbers of contracts for index options were 1241929 with a total turnover of Rs 29,475.34 Crore and total numbers of contracts for stock options were 60942 and notional turnover was Rs 1,977.99 Crore.

Today, Nifty would have a support at 4,478 and resistance at 4,622 and BSE Sensex has support at 15,322 and resistance at 15,610.