Pre Session Market Analysis for May 06, 2011

Pre Session Market Analysis for May 06, 2011
The benchmark indices on the stock exchange are likely to open negative as most of Asian stocks continued to fell, pulling regional benchmark index lower in more than three weeks led by significant slide in commodity since 2009. The MSCI Asia Pacific Index lost 1.2% in Tokyo, with more than four stocks retreated for every one that advanced on MSCI"s Asia Pacific index, set for its biggest drop since April 12.

Meanwhile, Japan"s Nikkei 225 Stock Average fell 1.82% or 181.59 points to 9,822.61 on slower than expected growth in the US service industry and rising jobless claims that fueled concern about pace of growth in the economy. Yen weakened against the dollar on an anticipation Japan"s government will intervene to curb gains. The broader Topix lost 1.3% to 854.55, with almost four time as many shares retreating as advancing. 

Shanghai Composite is down by 0.79% to 2,849.60 and Hang Seng Index lower by 0.51% to 119.49 to 23,142.12. Separately, Straits Times and Seoul Composite are trading down by 0.46% and 1.89% respectively. In the domestic arena, the markets are likely to follow the rout of global counter part and trade range-bound with downside movement. Metal, IT and Realty pivotals will be in focus today.

On Thursday, the domestic bourses ended the session on a bearish note as the benchmark indices continued to slide after speculation over petrol and diesel price hike decision made by the government. During the morning trade, most of Asian stocks declined, pulling regional benchmark index lower for the third straight session due to lower-than-estimated growth in the US service industries and employment that raised concerns over the pace of the economic recovery.

Soon after opening in the negative terrain, the benchmark indices started trading volatile across the baseline in a tight range. However, significant selling pressure emerged post mid-session and the benchmark Nifty was seen dragging near the 5,450 mark. The mixed opening for the European markets had limited impact in the domestic arena.

The BSE Sensex closed at 18,210.58 down by 258.78 points or by 1.40% and NSE Nifty closed at 5,459.85, lower by 77.30 points or by 1.40%. The BSE Midcap was at 6,800.66 down by 65.30 points or by 0.95% and the BSE SmallCap closed at 8,287.07, lower by 103.23 points or by 1.23%. The BSE Sensex touched intraday high of 18,569.21 and intraday low of 18,160.65.

On Thursday, the major equity averages veered sharply lower for the fourth time in as many sessions. Prior to this downward movement, the stock market had climbed in seven out of eight sessions. Sell-off was sparked with news of initial jobless claims for the week ended April 30 that spiked to 474,000 from expected figure of 400,000, given that the

This spike was much sharper than many expected on street. This report and disappointing ADP Employment Change report for April has raised eyebrows about what tomorrow morning's official jobs report might look like.

Within all this, the news of increase in first quarter productivity by 1.6%, better than expected figure of 1.0%, could not grabbed much attention. Meanwhile, energy stock continued to fell amid considerable weakness in oil prices which closed below $100 per barrel since mid-March.

Crude oil futures for July closed lower by 8.6% to $99.80 per barrel, settling below the $100 level for the first time since March 16, while July natural gas ended by 7% lower at $4.25 per MMBtu, lowest levels since April 19. Further, June futures for Gold dropped by 2.2% to $1,481.70 per ounce and July futures for silver fell 7.9% at $36.30 per ounce at the New York Mercantile Exchange.

In the major indices, the Dow Jones Industrial Average (DJIA) closed with a loss of 139.41 points or 1.10% at 12,584.17 NASDAQ index finished lower by 13.51 points or 0.48% to 2,814.72. The S&P 500 (SPX) closed lower by 12.22 points or 0.91% to 1,335.10.

The FIIs on Thursday stood as net seller in Equity while net buyer in Debt. Gross equity purchased stood at Rs. 2,449.00 Crore and gross debt purchased stood at Rs. 1,523.40 Crore, while the gross equity sold stood at Rs. 3,149.00 Crore and gross debt sold stood at Rs. 5,74.90 Crore. Therefore, the net investment of equity and debt reported were Rs. (700.00) Crore and Rs. 948.50

Top traded Volumes on NSE Nifty - Jaiprakash Associates Ltd. 13764091.00, Bharti Airtel Ltd. 8953797.00, Hindalco Industries Ltd. 6990527.00, Infrastructure Development Finance Company Ltd. 6624633.00, Reliance Communications Ltd. 6562979.00.

On BSE, total number of shares traded was 23.42 Crore and total turnover stood at Rs 2,734.96 Crore. On NSE, total number of shares traded were 51.98 Crore and total turnover was Rs 10,726.66 Crore.

On NSE Future and Options, total number of contracts traded in index futures was 584148 with a total turnover of Rs. 15,060.34 Crore. Along with this total number of contracts traded in stock futures were 494789 with a total turnover of Rs. 12,589.47 Crore. Total numbers of contracts for index options were 3014026 with a total turnover of Rs. 84,854.73 Crore and total numbers of contracts for stock options were 90675 with a total turnover of Rs. 2,380.81 Crore.

Today, Nifty would have a support at 5,410 and resistance at 5,500 and BSE Sensex has support at 18,020 and resistance at 18,320.

Read more about: bse, nse, nifty, sensex
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