Oct 10, 2008

Markets expected to open up initially but could run into resistance at higher levels

22 Sep 2008 | 00:00
Markets expected to open up initially but could run into resistance at higher levels

On Friday, the Indian Markets registered a smart rally with the BSE Sensex closing at 14042, up by 5.5% over Thursday’s close. After a gap up opening, the Nifty continued to show strength through the entire trading session.

Towards the end, it made an intra-day high of 4262.7 before closing at 4245.3, up by 5.1% over Thursday’s close. The NSE cash turnover stood at Rs. 16294 crores in comparison to Rs. 16088 crores on Thursday. The market breadth was positive on BSE with the advance-decline ratio of 1:0.4. All the sectoral indices ended in the green, with Realty, IT & TECk being the outperformers, which increased by 7.6%, 6.7% & 5.9% respectively.

Sweeping government measures to rescue the financial system and restore confidence in shaky markets spurred a huge relief rally in U.S. stocks on Friday. Dow Jones & Nasdaq both increased by 3.4%. The Indian ADRs ended in the green with Infosys, Wipro & Satyam increasing by 10.3%, 11.1% & 13% respectively. ICICI & HDFC Bank closed up by 7.6% & 6% respectively.

However MTNL closed down by 1%. Among the Latin American markets, the Mexican & Brazilian markets increased by 4.6% & 9.6% respectively. Among the Metal prices, Aluminium, Copper & Nickel decreased by 0.5%, 0.2% & 2% respectively, while Zinc increased by 0.1%. The light crude oil for October increased by 6.4% to settle at $104.6 a barrel. Today, the Asian Markets are trading on a mix note with Nikkei & Shanghai up by 2% & 6.5% respectively. However, Hang Seng is trading down by 0.5%, while Singapore Strait is trading flat.

On Thursday, the FIIs were net sellers of Rs. 599 crores in the cash markets, while they were net buyers of Rs. 996 crores in the F&O markets. Mutual Funds were net buyers of Rs. 940 crores. As per the provisional figures, FIIs were net buyers of Rs. 1016 crores in the cash market on Friday, while they were net buyers of Rs. 3980 crores in the F&O markets.

Today, we expect the Market's to open up initially. However, at higher levels it could witness profit taking after a sharp run up on Friday.