Pre Session Commentary - Sep 24 2009

Today domestic markets are likely to open negative as majority of Asian markets have opened with blood bath on the back of overnight selling in US markets. The F&O expiry today and further rollover would decide the movement of benchmark indices. The sentiments at this peak levels are fragile and therefore any upward movement will be tested by profit booking pressures. Today domestic markets are likely to trade negative.

On Wednesday, domestic markets ended with losses thereby halting the consecutive gains of the past six trading days. Markets opened on a flat note due to lack of cues from other global markets. Asian markets were trading on a subdued note as well and there was no driving news in the domestic arena that could bring some charm in trading. However as the trading progressed, profit booking pressures slaughtered stocks from Realty, CG, IT and FMCG baskets. JP Associates felt the blaze after the company exchanged around 45.4 million of shares in block deals in early trade. The deals were in a price range of Rs 239.75-244.80 a share. Further the company plans to raise up to $200 million through share sales which are the treasury shares created after the company absorbed its units Jaypee Hotels, Jaypee Cement and Gujarat Anjan Cement etc.

The BSE Sensex closed lower by 166.93 or (0.99%) points at 16,719.50 and NSE Nifty ended down by 50.25 points or (1%) at 4,969.95. BSE Mid Caps and Small Caps closed with losses of 76.16 and 101.99 points at 6,140.83 and 7,349.03 respectively. The BSE Sensex touched intraday high of 16,905.58 and intraday low of 16,683.78.

On Wednesday, US markets closed lower. Market participants were active ahead of the FOMC policy statement and therefore buying sentiments spurred across broader level. However despite Fed’s statement that the economic activity has picked up since its severe downturn stocks could not hold on its firmness at this peak level. The session closed with worst loss since the beginning of this month. Telecom stocks outperformed for the entire session with a remarkable gain of 1.6%. On the other hand, due to bearish oil inventory data, energy stocks traded the entire session in the negative terrain and closed with a loss of 1.9%. Financial sector was the worst performing as it closed with a severe loss of 2.1%. At the macro economic level, the Fed kept its key rate unchanged at 0.00% to 0.25%. The FOMC said it will purchase $1.25 trillion of agency mortgage backed securities and $200 billion agency debt. However it will gradually slow the pace of purchases to promote a smooth transition in markets. Crude oil futures for the month of November delivery closed lower by 3.9% at $68.99 per barrel on New York Mercantile Exchange.
The Dow Jones Industrial Average (DJIA) closed lower by 81.32 points at 9,748.55. NASDAQ index fell by 14.88 points at 2,131.42 and the S&P 500 (SPX) declined by 10.79 points to close at 1,060.87 points.
Today the major stock markets in Asia are trading negative. Hang Seng index is trading low by 560.46 points at 21,035.06. However, Japan''s Nikkei is up by 131.45 points at 10,501.99, Singapore''s Straits slipped 18.50 points at 2,667.44 and Taiwan Weighted is trading low by 62.71 points at 7,314.05.

The FIIs on Wednesday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 3,208.40 Crore and gross debt purchased stood at Rs 359.50 Crore, while the gross equity sold stood at Rs 1,704.90 Crore and gross debt sold stood at Rs 494.80 Crore. Therefore, the net investment of equity and debt reported were Rs 1,503.50 Crore and Rs (135.40) Crore respectively.

On Wednesday, Indian Rupee closed at 48.02/03 per dollar, 0.17% stronger than its previous close at 47.95/96. Late selling pressure in the local stock markets pulled the local currency.

On BSE, total number of shares traded were 56.79 Crore and total turnover stood at Rs 6,741.80 Crore. On NSE, total number of shares traded were 94.93 Crore and total turnover was Rs 17,554.24 Crore.

Top traded volumes on NSE Nifty – Suzlon Energy with total volume traded 64445982 shares, followed by Unitech with 35147212, DLF with 12825522, Bharti Airtel with 8653344 and Tata Steel with 7530923 shares.

On NSE Future and Options, total number of contracts traded in index futures was 836388 with a total turnover of Rs 20,419.47 Crore. Along with this total number of contracts traded in stock futures were 1016348 with a total turnover of Rs 33,204.84 crore. Total numbers of contracts for index options were 1425402 with a total turnover of Rs 35,420.33 Crore and total numbers of contracts for stock options were 63310 and notional turnover was Rs 2,133.71 Crore.

Today, Nifty would have a support at 4,887 and resistance at 4,992 and BSE Sensex has support at 16,568 and resistance at 16,796.