Pre Session Commentary - Oct 8 2009

Today domestic markets are likely to open positive as majority of Asian markets have opened in green. There is some firmness in Asian markets despite some consolidation happening at this peak levels. There are no cues from US markets, which closed flat after spending most of its session in the negative territory. In the domestic arena one could witness some rebound happening in the frontline stocks. However the sentiments are still cautious and therefore, domestic markets are likely to trade range bound during the day.

On Wednesday, domestic market pared all its initial gains and ended the day on weak note backed by fresh selling in key stocks that emerged during last trading hours. Profit-booking pressure at several blue chip counters also contributed to the downward journey. However, market exhibited good show during the first half of the trading, mirroring firm global markets but was unable to hold the momentum and slipped further. Meanwhile, benchmark indices moved between positive and negative terrain during afternoon trade on continuous bouts of buying and selling. BSE Sensex ended below 16,900 level and NSE Nifty closed below 5,000 level.

The BSE Sensex closed lower by 151.88 points or (0.90%) at 16,806.66 and NSE Nifty ended down by 41.65 points or (0.83%) at 4,985.75. BSE Mid Caps and Small Caps closed with gains 87.63 and 33.96 points at 6,295.06 and 7,406.55 respectively. The BSE Sensex touched intraday high of 17,120.56 and intraday low of 16,764.07.

On Wednesday, the US stock market closed flat after spending most of its session in negative territory. The resurgence in dollar from its previous three session losses, kept the stocks out of shine during the day’s trade. Banking stocks managed to emerge at a strong contender and find some direction in the early going. The KBW Bank index gained by 1.2% and the financial sector closed with a significant gain of 1%. Energy, Tech, Consumer Staples and Materials were the lead gainers of the day with respective gains of 0.6%, 0.5%, 0.3% and 0.2% respectively. The leadership of financial sector helped S&P 500 close with on a stronger note. Telecom was the only sector that closed with a severe loss of 2.9%. US light crude oil futures for November delivery closed with a loss of 1.7% at $69.66 per barrel, on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) ended with a marginal loss of 5.67 points at 9,725.58. NASDAQ index surged 6.76 points to 2,110.33 and the S&P 500 (SPX) closed higher by 2.86 points at 1,057.58.

Indian ADRs ended mixed on Wednesday. However, losers outnumbered the gainers. In the telecom space, Tata Communication was down 3.22% and MTNL was down 0.57%. In the banking space, ICICI Bank was down 3.09% and HDFC Bank was down 2.3%. In the IT space, Infosys was down 2.1%, Wipro was down 1.94%, Satyam Computers was down 0.93% and Patni Computers was down 1.31%. In other sectors, Tata Motors was unchanged, while Dr Reddy''s Labs was up 0.35% and Sterlite Industries was up 1.43%.

The FIIs on Wednesday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 4,178.30 Crore and gross debt purchased stood at Rs 360.00 Crore, while the gross equity sold stood at Rs 4,146.90 Crore and gross debt sold stood at Rs 577.80 Crore. Therefore, the net investment of equity and debt reported were Rs 31.40 Crore and Rs (217.90) Crore respectively.

On Wednesday, the partially convertible rupee ended at 46.66/67 per dollar, 0.49% stronger than Tuesday’s closing at 46.89/90. The weakness in dollar across the globe and also the downtrend is local stock markets have reinforced strength in local currency.

On BSE, total number of shares traded were 59.07 Crore and total turnover stood at Rs 6,634.57 Crore. On NSE, total number of shares traded were 93.15 Crore and total turnover was Rs 21,042.82 Crore.

Top traded volumes on NSE Nifty – Unitech with total volume traded 46035420 shares, followed by Bharti Airtel with 38085626, Suzlon Energy with 22056804, Idea Cellular with 18786520 and Reliance Comm with 15667178 shares.

On NSE Future and Options, total number of contracts traded in index futures was 772443 with a total turnover of Rs 18,646.49 Crore. Along with this total number of contracts traded in stock futures were 704670 with a total turnover of Rs 23,457.66 crore. Total numbers of contracts for index options were 1450112 with a total turnover of Rs 36,648.07 Crore and total numbers of contracts for stock options were 70988 and notional turnover was Rs 2,277.94 Crore.

Today, Nifty would have a support at 4,902 and resistance at 5,048 and BSE Sensex has support at 16,612 and resistance at 16,896.