Pre Session Commentary - Nov 9 2009

Today domestic markets are likely to open positive as majority of Asian markets have also opened in green. The fifth straight gain in US markets despite disappointing non-farm payrolls data has raised hopes of firmness across global markets. The positive comments last week from Central Bank of Australia about the country’s phenomenal growth prospects will weigh more on the investors confidence for a couple of weeks. Domestic markets are likely to trade range bound with positive bias during the day.

On Friday, the Indian stock market closed in green tracking the firm cues from the global markets. Heavy buying was witnessed during the trading session and the investors’ sentiments was boosted on the back of some favoring data like better than expected jobless claims data in US that recorded at 5,12,000 down 20,000 from the previous week and better than the expected 5,22,000. The continuing claims came in at 5.75 million, which was inline with the expectations and down from 5.82 million in the previous week. Moreover, the rally across the Asian markets after Australian Central bank increased its economic growth forecasts by more than tripled further boosted the sentiments. The Union Cabinet’s approval of listing the state run firms on the stock exchanges, which have a track record of profits in the past three years, also supported the sentiments. The government decided that the proceeds from the equity divestment in State run firms can be utilized for capital expenditure on social sector programmes instead of routing it through the National Investment fund. The BSE Sensex closed above the 16,150 mark while Nifty just above 4,790 mark. From the sectoral front, the PSU index (up 3.91%), Realty index (up 2.81%) and Metal index (up 2.03%) attracted the investors’ confidence as most buying was witnessed from this basket.

The BSE Sensex closed higher by 94.38 points or (0.59%) at 16,158.28 and NSE Nifty closed up by 30.60 points or (0.64%) at 4,796.15. The BSE Mid Caps closed higher by 138.92 points at 6,254.36 and the BSE Small Caps closed up by 157.09 points at 7,170.94. The BSE Sensex touched intraday high of 16,283.86 and intraday low of 16,075.19.

On Friday, the US stock market closed higher marking its fifth straight session gain. The opening was modest and traders were closing watching the non-farm payroll data that recorded job losses of 190,000 in the month of October slightly higher than the expected 175,000. The unemployment rate climbed a 25-year high at 10.2% as against the expected 9.9%. Another economic data was the wholesale report that indicated inventories fell 0.9% in September. There was lack of charm in the market and stocks spent most of its time in a choppy session. Industrial sector managed to lead the day’s gains on the back of analyst upgrades for General Electric. Financials were the laggard of the day, which ended with a loss of 0.5%. Despite positive earnings report from AIG, its shares witnessed immense selling pressure. US light crude oil futures for December delivery closed with a loss of 2.9 per cent at $77.35 per barrel, on the New York Mercantile Exchange.

The Dow Jones Industrial Average (DJIA) ended with gain of 17.46 points at 10,023.42. NASDAQ index surged 7.12 points to 2,112.44 and the S&P 500 (SPX) closed higher by 2.67 points at 1,069.30.

The Indian ADRs ended mixed on Friday. In the IT pack, Infosys was down 1.04%, Satyam was down 1.13%, while Wipro was up 0.95% and Patni was up 0.19%. In the telecom space, Tata Comm was up 0.39%, while MTNL was down 3.76%. In the banking space, ICICI Bank was down 0.19%, while HDFC Bank was up 1.21%. In the other sectors, Tata Motors was down 0.49%, Sterlite was up 0.18% and Dr Reddys was up 0.35%.

The FIIs on Friday stood as net buyers in equity and net sellers in debt. Gross equity purchased stood at Rs 2,035.50 Crore and gross debt purchased stood at Rs 1,059.40 Crore, while the gross equity sold stood at Rs 1,767.90 Crore and gross debt sold stood at Rs 314.90 Crore. Therefore, the net investment of equity and debt reported were Rs 267.60 Crore and Rs 744.50 Crore respectively.

On Friday, the partially convertible rupee ended at 46.81/82 per dollar, 0.42% stronger than previous closing at 47.01/02 per dollar. The local currency gained strength on the back of phenomenal surge in local stock markets.

On BSE, total number of shares traded were 42.29 Crore and total turnover stood at Rs 6,019.18 Crore. On NSE, total number of shares traded were 87.89 Crore and total turnover was Rs 16,857.41 Crore.

Top traded volumes on NSE Nifty – Suzlon Energy with total volume traded 77625285 shares, followed by Unitech with 45704656, Jaiprakash Asso with 16921007, Idea Cellular with 13794569 and DLF with 11350626 shares.

On NSE Future and Options, total number of contracts traded in index futures was 712632 with a total turnover of Rs 16,575.91 Crore. Along with this total number of contracts traded in stock futures were 594679 with a total turnover of Rs 19,259.90 crore. Total numbers of contracts for index options were 1645646 with a total turnover of Rs 39,631.55 Crore and total numbers of contracts for stock options were 60470 and notional turnover was Rs 1,928.51 Crore.

Today, Nifty would have a support at 4,819 and resistance at 4,864 and BSE Sensex has support at 16,198 and resistance at 16,332.