Oct 10, 2008

Markets expected to open up initially, but could witness selling pressure at higher levels

24 Sep 2008 | 10:17
Markets expected to open up initially, but could witness selling pressure at higher levels

The Indian Markets closed on a weak note on Tuesday with the BSE Sensex closing at 13995, down by 3% over Monday’s close. After opening on a weak note, the Nifty recovered well from the lows. However, at 4224.7, it started showing signs of weakness once again & post noon, witnessed huge sell off to make an intra-day low of 4117.9, before closing at 4126.9, down by 2.3% over Monday’s close. The NSE cash turnover stood at Rs. 10610 crores in comparison to Rs. 11519 crores on Monday. The market breadth was negative on BSE with the advance-decline ratio of 0.4:1. All the sectoral indices ended in the red with IT, Realty & Banks being the major losers, decreasing by 5.1%, 4.7% & 4.2% respectively.

The U.S. markets fell on Tuesday on fear that congressional wrangling could delay a proposed $700 billion plan to rescue the financial sector, increasing worries about the struggling U.S. economy. Dow Jones & Nasdaq decreased by 1.5% & 1.2% respectively. The Indian ADRs ended mix with Infosys, Wipro & Satyam decreasing by 4.8%, 6.8% & 2.4% respectively. HDFC Bank & MTNL closed up by 5.7% & 5.4% respectively. Among the Latin American markets, the Mexican markets decreased by 0.7%. Among the Metal prices, Aluminium & Copper decreased by 1.2% & 0.6% respectively, Zinc & Nickel decreased by 1.6% & 2% respectively. The light crude oil for October decreased by 2.5% to settle at $106.6 a barrel. Today, the Asian Markets are trading on a mix note with Nikkei & Shanghai trading down by 1.2% & 2.3% respectively. However, Hang Seng & Singapore Strait are trading up by 1.6% & 0.4% respectively.

On Monday, the FIIs were net buyers of Rs. 111 crores in the cash markets, while they were net buyers of Rs. 512 crores. Mutual Funds were net sellers of Rs. 332 crores. As per the provisional figures, FIIs were net sellers of Rs. 924 crores in the cash market on Tuesday, while they were net sellers of Rs. 275 crores in the F&O markets.

Today, we expect the Markets to open up initially. However, at higher levels, it could witness selling pressure. Among the sectoral indices, Oil & Gas, FMCG & PSUs are looking good, while IT & Realty continue to remain weak