US GDP is expected to have grown at a 3.2% annualized rate in the third quarter

Domestic News:

US GDP is expected to have grown at a 3.2% annualized rate in the third quarter after shrinking at an 0.7% annualized rate in the second quarter. US new home sales fell to a 402,000 unit annualized rate in September from a revised 417,000 unit annualized rate in August, the Commerce Department reported. US orders for manufactured goods meant to last three years or more rose 1% in September, after falling 2.6% in the previous month. Asian stocks dropped, extending a global decline, after the head of Australia & New Zealand Banking Group Ltd. said the Australian economy is “still fragile” and new-home sales unexpectedly fell in the U.S. China has told the U.S. that it will take steps that could lead to higher tariffs on imports of autos made by GM, Chrysler and Ford. The industrial output growth may see a drop in September 2009 from the 10.4% growth registered in August as the index of core sector industries, which has a weightage of 26.7% in the index, clocked a 4% growth in September 2009, sharply lower than 7.8% in the month before. Finance Minister, Mr. Pranab Mukherjee, has convened a meeting of financial advisors of various ministeries and departments today to take stock of the current situation and discuss measures for balancing growth with inflation by gradually withdrawing tax concessions and pump prime measures initiated to counter the slowdown. Successful bidders of 3G spectrum auctions will be allowed to treat their bid amount as expenses over a 20-year period, the tenure during which the 3G license is valid. The Employees Provident Fund Organisation will be seeking approval from its apex decision-making body, CBT, to implement a finance ministry order to invest up to 15 per cent of the funds in equity. The United States Telecommunications Sub-committee, an advocacy body which looks into telecom regulations around the world, has suggested a slew of reforms for India to implement in the communications sector. This includes increasing FDI limit from 74 per cent to 100 per cent, making the upcoming 3G auction rules more conducive for foreign players and allowing unrestricted Net telephony.

Corporate news:

Pfizer is going ahead with its plans to buy the biotech business of Wockhardt, but Mumbai-based drug maker has not shown any inclination for a sell out. RNRL alleged before the Supreme Court that the Ministry of Petroleum and Natural Gas was hand-in glove with RIL in the dispute over gas supply from the KG basin D6 block. Wills Lifestyle, part of the ITC, is planning to add 100 more stores over the next three years. Mahindra & Mahindra unveiled a brand new light commercial vehicle Gio, priced at Rs.1.65 lacs. SpiceJet may raise USD50 million by selling shares to fund expansion and start international flights. Intel, the world’s largest chipmaker, is understood to be in talks with leading Indian telecom companies like Tata Communications, Bharti Airtel and Reliance Communications that could bid for broadband wireless access spectrum to be auctioned by the government in January 2010. Airtel has launched a triple-play arcade puzzle game Getris on all three services of Airtel-mobile, internet and direct to home. This game would be available for DTH customers at Rs.25 for every two months and Rs.10 per month for Airtel mobile customers.

Technical View:

Nifty: (826): The index opened on a negative and saw choppy trades throughout the day’s trading session. It ended the day with loss of 20 points. The index encountered post its close below the 10 and 20 day averages is exhibiting weakness. On the downside index can test lower level around the recent breakout level of 4736 where support can be expected. On the intra day charts index is in oversold zone.Intra day support is around 4780 level. On the upside index faces resistance around 4872 and 4904,intra day bounce should face resistance around this level. Nifty Oct contract ends the Day down by 22 points at a premium of 0.40 points in Oct contracts adding OI by 2.1% across all active Nifty contracts. Nifty Open Int PCR at 1.060 compared to 1.095 yesterday on back of addition of 9.9 Lakh in Nifty puts and addition of 27.8 Lakh call options. Nifty VIX at 28.48 from 28.18 the previous Day. Highest OI in Nifty put at 4700 Oct strike and calls is at 5100 Oct strike. Market wide rolls seen at 61.69% compared to 3 month average of 59.99% and 6 month average of 57.16%.
Nifty rollover seen at 64.4% compared to the 3 month average of 59.9. Nifty sees 15% higher rollover (55208 contracts) compared to the previous expiry. Infrastructure, Textile, Telecom, Hotels, Sugar & Fertilisers saw more than 30% rise in rollover
Media, Technology, Cement, Capital Goods & Automobile saw a fall in rollover.