Pre Session Commentary - Sep 22 2008

The Indian Market is expected to have positive opening due to favoring cues from the global markets. On Friday, the Indian markets took a big leap and rallied throughout the trading session on the back of US treasury department step to come out with a plan to create a Resolution Trust-like operation to calm the economic turmoil and the financial crisis. This gave a boost to the sentiments of the investors across the globe that led to sustained buying across then sectoral indices. BSE Sensex returned back to the 14,000 level and NSE Nifty crossed 4,200 mark. The bulls become more powerful during final hours of trading as markets closed with gains of more than 5%. From the sectoral front, all indices ended with gains and among those reality stocks outperformed the benchmark index as closed with gain of more than 7%. Along with that, Oil & Gas, Capital Goods, Bank, Metal and IT stocks witnessed healthy buying from these baskets. We expect that the market may extend its gains during the trading session.

The BSE Sensex closed higher by 726.72 points at 14,042.32 and NSE Nifty ended up by 207.10 points at 4,245.25. The BSE Mid Caps and Small Caps closed with gains of 149.65 points at 5,228.78 and by 140.56 points at 6,215.99. The BSE Sensex touched intraday high of 14,097.44 and intraday low of 13,674.96.

On Friday, the US market surged to close with handsome gains on the back of on news of the rescue plan, capping one of the most tumultuous weeks in history for global financial markets and also the move by US Treasury to ask Congress for authority to spend 700 bn dollars to buy mortgage related assets from financial institutions. The US Federal Reserve on Sunday announced that US investment banks Goldman Sachs and Morgan Stanley will become bank holding companies and will receive new US government credit.

The Dow Jones Industrial Average (DJIA) closed up by 368.75 points at 11,388.44 followed by the NASDAQ index closed higher by 74.80 points at 2,273.90 and the S&P 500 (SPX) grew by 48.57 points to close at 1,255.08.

Indian ADRs ended with handsome gains. In technology sector, Satyam closed up by (13.04%) followed by Wipro by (11.18%), Infosys by (10.25%) and Patni Computers by 4.82%. In banking sector ICICI Bank and HDFC Bank grew by (7.61%) and (5.96%). In telecommunication sector, Tata Communication advanced by (0.24%). Sterlite industries advanced by (4.77%).

Today the major stock markets in Asia are trading higher. Hang Seng index is trading up by 15 points at 19,343 along with Japan’s Nikkei trading up by 236 points at 12,157, Taiwan Weighted trading at 6,070 up by 100 points. Singapore''''s Straits up by 4 points at 2,555.

The FIIs on Friday stood as net seller in equity and net buyer in debt. Gross equity purchased stood at Rs7,146.70 Crore and gross debt purchased stood at Rs66.40 Crore while the gross equity sold stood at Rs7,745.40 Crore and gross debt sold stood at Rs10 Crore. Therefore, the net investment of equity reported was (Rs598.70) Crore and net debt was Rs56.40 Crore.

On Friday, the Indian rupee appreciated by 58 paise and reached the 46 level on positive sentiments as the domestic stock market surged. The rupee opened stronger at 46.25 as the domestic equities market and those in South East Asia opened higher. The rupee then gained following the soar in the equities to touch the day''s high of 45.75. It closed at 45.83, against the previous close of 46.41/42. In the forward premia market, the six-month closed at 1.38 per cent and the 12-month ended at 1.15 per cent.

Today, Nifty has support at 4,131 and resistance at 4,362 and BSE Sensex has support at 13,623 and resistance at 14,493.