Pre Session Commentary - Sep 15 2008

The Indian Market is expected to have gap down opening as US markets closed mixed and Asian markets are trading lower. On Friday, domestic markets extended losses for the fourth consecutive day to close in deep red. It was a bad day for the market as BSE Sensex closed around 14,000 level and NSE Nifty ended around 4,200 mark. Markets opened higher tracking positive cues from the global markets. Further market gave up its gains and continued to trade sharply lower. Markets ignored fair IIP number and further slipped during last trading hours to end the day with heavy losses. European markets also contributed to the trailing sentiment. From the sectoral front, all indices declined and among that IT stocks were worst performer as closed with loss of more than 4%. Apart form that, heavy selling was seen in Oil & Gas, Reality, Metal, Bank and Capital Goods stocks. The BSE Sensex closed lower by 323.48 points at 14,000.81 and NSE Nifty ended down by 61.85 points at 4,228.45. The BSE Mid Caps and Small Caps closed with losses of 110.06 points at 5,537.14 and by 107.39 points at 6,711.54. We expect that market may lose some ground during the trading session.

IIP data came in better than expected as it rose 7.1% in July 2008 as against 5.4% in the previous month. IIP growth was 8.3% for the same period last year. Drivers to this growth were Capital Goods up by 21.9% as against 12.3% YoY and Consumer Goods up by 7.3% as compared to 7.1% YoY.

On Friday, the US market closed mixed after struggled to make progress. Traders continue to await clarity related to the fate of Lehman Brothers and Washington Mutual. Crude oil prices exhibited sea-saw movement to close at $101.18 a barrel. Ealier it dipped below $100 a barrel for the first time in 5 months on the New York Mercantile Exchange and also touched high of $102.89 a barrel.

The Dow Jones Industrial Average (DJIA) closed lower by 11.72 points to close at 11,421.99, while the NASDAQ index ended marginally up by 3.05 points to close at 2,261.27 and the S&P 500 (SPX) gained slightly 2.65 points to close at 1,251.70.

Indian ADRs ended mixed. In technology sector, Satyam ended higher by (0.76%) followed by Infosys advanced by (0.16%), while Wipro plunged (0.84%) and Patni Computers lost (4.37%). In banking sector HDFC Bank advanced (0.36%) while ICICI Bank lost (1.39%. In telecommunication sector, MTNL gained (1.61%) and Tata Communication plunged (0.31%). However, Sterlite industries increased by (2.04%).

Today the major stock markets in Asia are trading lower due to uncertainty over the fate of Lehman. Lehman Brothers prepared to file for bankruptcy. Taiwan Weighted is trading weaker by 190.05 points at 6,120.63 along with Singapore''s Straits trading down by 52.03 points at 2,5618.64. Hong Kong stock market is closed today for a public holiday.

The FIIs on Friday stood as net seller in equity and net buyer in debt. Gross equity purchased stood at Rs2,332.90 Crore and gross debt purchased stood at Rs955.50 Crore while the gross equity sold stood at Rs3,743.50 Crore and gross debt sold stood at Rs99.20 Crore. Therefore, the net investment of equity reported was (Rs1410.50) Crore and net debt was Rs856.30 Crore.

Indian rupee ended at 45.74/75 per dollar on Friday from Thursday's close at 45.56/57 per dollar. It trims losses after IIP data as before that it touched a low of 44.80.

Today, Nifty has support at 4,156 and resistance at 4,292 and BSE Sensex has support at 13,704 and resistance at 14,248.