Pre Session Commentary - Sep 1 2009

Today domestic markets are likely to open positive as majority of Asian markets have opened in green as a bounce back over yesterday’s losses. Majority of frontline stocks are already at their peak level and therefore any further northward movement is apprehensive. The day’s trade is likely to be range bound.

On Monday, the Indian market extended its losses towards the closing to end the session on negative note on sustained selling pressure during the trading. Unfavorable cues from the Asian markets along with negative European stocks took huge beating on the bourses. Chinese stocks plunged 6.74% on continued worries about the impact of fragile bank lending on the economy. Lower US Index futures also fueled the negative sentiments that off set the positive news from domestic arena that India’s economic growth accelerated for the first time since 2007. India’s gross domestic product expanded 6.1% in the first quarter ended June 30 2009 from 7.8% of the corresponding period of previous year. The BSE Sensex ended below 15,700 level and NSE Nifty closed below 4,700 mark.

The BSE Sensex closed lower by 255.70 or (1.61%) points at 15,666.64 and NSE Nifty ended down by 70.25 points or (1.48%) at 4,662.10. BSE Mid Caps and Small Caps closed with gains of 19.27 and 35.27 points at 5,882.97 and 6,997.03 respectively. The BSE Sensex touched intraday high of 15,821.35 and intraday low of 15,589.80.
On Monday, US stock markets closed lower. There was broad based selling across broader level as majority of Asian and European markets exuded huge selling pressure due to concerns over tighter lending in China that will most likely impede the flow of investment. The Shanghai Composite dropped 6.7% on Monday to hit a three-month closing low and log its second worst monthly performance in 15 years. However towards the end majority of stocks managed to pare off its early losses and closed marginally lower. Tuesday’s opening bell will be very crucial for the US markets as ISM manufacturing data for August, construction spending data for July, pending home sales data for July and also vehicle sales data are likely to provide some guidance to traders. US light crude oil futures for October delivery closed at $69.92 per barrel down by 3.9% on the New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) closed lower by 47.92 points at 9,496.28, NASDAQ index closed lower by 19.71 points at 2,009.06 and the S&P 500 (SPX) also closed lower by 8.31 points at 1,020.62.

Indian ADRs ended in red barring Satyam Computers, which was up 21.53%. In the IT space, Infosys was down 2.26%, Wipro was down 1.13% and Patni Computers was down 0.81%. In the telecom space, Tata Communication was down 3.09% and MTNL was down 1.54%. In the banking space, ICICI Bank was down 1.61% and HDFC Bank was down 0.74%. In other sectors, Tata Motors was down 3.82%, Sterlite Industries was down 3.74% and Dr Reddy''s Labs was down 2.24%.

The FIIs on Monday stood as net buyers in equity and debt. Gross equity purchased stood at Rs 2,574.30 Crore and gross debt purchased stood at Rs 387.80 Crore, while the gross equity sold stood at Rs 1,481.50 Crore and gross debt sold stood at Rs 307.80 Crore. Therefore, the net investment of equity and debt reported were Rs 1,092.70 Crore and Rs 80.00 Crore respectively.

On Monday, Indian Rupee closed at 48.83/84 per dollar, 0.4% weaker than its previous close at 48.65/66. The local lost strength due to correction in local stock market.

On BSE, total number of shares traded were 57.19 Crore and total turnover stood at Rs 6,650.52 Crore. On NSE, total number of shares traded were 113.56 Crore and total turnover was Rs 19,064.76 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 189851099 shares, followed by Suzlon Energy with 37167556, DLF with 14590713, Tata Steel with 13974491 and Cairn India with 7640662 shares.

On NSE Future and Options, total number of contracts traded in index futures was 741814 with a total turnover of Rs 16,282.66 Crore. Along with this total number of contracts traded in stock futures were 567261 with a total turnover of Rs 18,762.88 crore. Total numbers of contracts for index options were 950802 with a total turnover of Rs 22,498.64 Crore and total numbers of contracts for stock options were 52135 and notional turnover was Rs 1,871.46 Crore.

Today, Nifty would have a support at 4,622 and resistance at 4,732 and BSE Sensex has support at 15,512 and resistance at 15,756