Nifty snaps December F&O series with a cut of 2.32%

The domestic index S&P CNX Nifty finally finished its sluggish run for the December series below its crucial 4,650 level as global cues remained subdued, moreover the index performed choppy throughout the series and closed with a cut of about 110.20 points or 2.32 percent compared to last series. The global markets remained weak throughout the month on fears of the European debt crisis. Moreover, today market snapped the day’s trade with a cut of over a percentage point and breached its crucial 4,650 mark on the back of late hour selling.

Initially, the local index extended its losses for the third consecutive session on morning trade on sustained selling by funds amid a weakening trend on other Asian bourses. Global cues too remained unsupportive as US markets plunged overnight on getting worrying news from the ECB that its overnight deposits hit another record and continent’s banks parked a record $590.72 billion with it overnight. Afterwards, market regained some of its lost ground and managed to recapture its crucial 4,700 mark supported by improving inflation numbers. Inflation for week ended December 17, 2011 has came in line with the expectation. Food article inflation has come in 0.42% against 1.81%. Primary articles inflation is at 2.7% against 3.78%, while fuel group inflation slipped at 14.37% versus 15.24. In the noon trade, the benchmark turned choppy as sentiment kept weakening on low volumes. Today being the year’s last F&O expiry day, the market remained volatile and kept falling deeper in red. However, positive opening on European stocks also failed to boost the sentiments. After witnessing a jaggy session, the bourses slipped to intraday lows in the final hours. Finally, Nifty snapped the day’s trade breaching its crucial 4,650 level with a cut of over a percentage point. Meanwhile, the seven companies barred to invest in securities markets by SEBI for violating IPO norms crashed in trade today. Taksheel Solutions, RDB Rasayans, Brooks Laboratories, Tijaria Polypipes touched its lower circuit today while PG Electroplast tanked 17 percent and Onelife Capital Advisors closed about 8 percent lower.      

On the global front, the US markets suffered significant losses overnight while, most of the Asian markets reversed their initial losses and ended the session in the positive terrain snapping their three day’s losing streak on Thursday but, volume remained thin as concerns about Europe’s debt crisis kept investors sidelined in the trade. Moreover, European counterparts were trading mixed at this point of time. Back home, most of the sectoral indices on the NSE were settled in the red, CNX Realty remained the major loser, down 1.93% followed by CNX Infra down 1.84% and CNX PSE down by 1.43% while CNX PSU Bank and CNX Metal surged 0.80% and 0.30% remained the only gainer in the trade, respectively. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged 0.44% and reached 26.62.

The India VIX witnessed contraction of 0.44% at 26.62 as compared to its previous close of at 26.74 on Wednesday.

The 50-share S&P CNX Nifty lost 59.55 points or 1.27% to settle at 4,646.25.

Nifty December 2011 futures closed at 4,646.30 at a premium of 0.05 points over spot closing of 4,646.25, while Nifty January 2011 futures were at 4,669.90 at a premium of 23.65 points over spot closing. Nifty December futures saw addition of 15.72% or 1.70 million (mn) units taking the total outstanding open interest (OI) to 12.53 mn units.

From the most active contract by contract value, SBI’s December 2011 futures were at a premium of 5.10 point at 1629.20 compared with spot closing of 1624.10. The number of contracts traded was 34,985.

SBI’s January December 2011 futures were at a discount of 23.60 point at 1600.50 compared with spot closing of 1624.10. The number of contracts traded was 25,186.

RIL December 2011 futures were at a premium of 2.50 points at 712.00 compared with spot closing of 709.50. The number of contracts traded was 27,145.

RIL January 2011 futures were at a premium of 8.30 point at 717.80 compared with spot closing of 709.50. The number of contracts traded was 26,351.

Axis Bank December 2011 futures were at a premium of 6.30 point at 815.30 compared with spot closing of 809.00. The number of contracts traded was 17,325.

Among Nifty calls, 4700 SP from the December month expiry was the most active call with an addition of 86.23% or 4.06 million.

Among Nifty puts, 4700 SP from the December month expiry was the most active put with a contraction of 46.92% or 2.54 million.

The maximum Call OI outstanding for Calls was at 4700 SP (8.77 mn) and that for Puts was at 4700 SP (2.88 mn).

The respective Support and Resistance levels are: Resistance 4685.68 -- Pivot Point 4662.36 -- Support 4622.93.

The Nifty Put Call Ratio (PCR) OI wise stood at 0.72 for December -month contract.

The top five scrips with highest PCR on OI were Patni 11.69, CESC 4.20, Neyveli Lignite 4.00, Opto Circuts 3.86 and Indian Hotels 3.05.

Among most active underlying, SBI witnessed a contraction of 0.41 million of Open Interest in the December month futures contract followed by Reliance Industries which witnessed an addition of 0.03 million of Open Interest in the near month contract. Meanwhile ICICI Bank witnessed a contraction of 0.51 million in the December month futures. Also, Axis Bank witnessed a contraction of 0.33 million in Open Interest in the December month contract. Finally, Tata Steel witnessed a contraction of 0.45 million of Open Interest in the near month futures contract.