Nifty once again posts record closing high

Nifty, the 50-share index opened gap up, buoyed by previous session’s boisterous gains, went from strength to strength, scaling all time record high of 8100 and settled just below it. There was not a single instance of profit booking on the index as it investors bought stocks across the board fending off any negative developments in the economy. Sentiments got a boost on the back of continued capital inflows, driven by positive economic data with the GDP growth improving to two-and-a-half year high of 5.7 per cent in the April-June quarter and the Current Account Deficit (CAD) narrowed sharply to 1.7 per cent of GDP. Besides, the government's request to the apex court not to cancel the permits for 46 coal blocks and Japan’s announcement of doubling investment in India to about $34 billion over the next five years also boosted sentiment. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 554.14 crore on September 01, 2014. However, gains remained capped as Core sector output in the month of July slowed down to 2.7% from nine-month high growth of 7.3% in June mainly due to decline in production of crude oil, natural gas, refinery products, fertilisers and steel. Traders were seen piling up positions in Consumer Durables, Healthcare and Infrastructure while selling were witnessed in Metal Power and Capital Goods sector stocks.

After this four-day rally, nifty may show some amount of correction in the near future as rich valuations and global uncertainties could prompt investors to book some profits. In the index options segment, maximum OI continues to be seen in the 8200-8100 calls and 7900-7800 puts indicating the expected trading range. Meanwhile, India VIX - the gauge of underlying volatility in the market - has declined in today's session, which indicates that traders have slowed down buying options contracts. The top gainers from the F&O segment were Just Dial, Cipla and Petronet LNG. The top losers were Jindal Steel & Power, Jaiprakash Associates and UCO Bank.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 0.61% and reached 13.44. The 50-share CNX Nifty increased by 55.35 points or 0.69% to settle at 8,083.05. Nifty September 2014 futures closed at 8121.45 on Tuesday at a premium of 38.40 points over spot closing of 8,083.05, while Nifty October 2014 futures ended at 8161.55 at a premium of 78.50 points over spot closing. Nifty September futures saw an addition of 0.34 million (mn) units, taking the total outstanding open interest (OI) to 16.68 mn units. The near month derivatives contract will expire on September 25, 2014.

From the most active contracts, HDFC Bank September 2014 futures traded at a premium of 6.95 points at 866.45 compared with spot closing of 859.50. The number of contracts traded were 18,525.

DLF September 2014 futures traded at a premium of 0.50 points at 184.55 compared with spot closing of 184.05. The number of contracts traded were 12,593.

Reliance Industries September 2014 futures traded at a premium of 7.65 points at 1031.65 compared with spot closing of 1024.00. The number of contracts traded were 37,489.

Jindal Steel & Power September 2014 futures traded at a premium of 1.70 points at 240.65 compared with spot closing of 238.95. The number of contracts traded were 12,161.

ICICI Bank September 2014 futures traded at a premium of 6.15 points at 1595.05 compared with spot closing of 1588.90. The number of contracts traded were 21,593

Among Nifty calls, 8200 SP from the September month expiry was the most active call with an addition of 0.09 million open interests. Among Nifty puts, 8,000 SP from the September month expiry was the most active put with a contraction of 2.19 million open interests. The maximum OI outstanding for Calls was at 8200 SP (4.75 mn) and that for Puts was at 8,000 SP (5.66 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8111.15 --- Pivot Point 8073.85--- Support --- 8045.75.

The Nifty Put Call Ratio (PCR) finally stood at 1.15 for September month contract. The top five scrips with highest PCR on OI were Apollo Hospital (2.50), Sun TV (1.90), Hero MotoCorp (1.33), Kotak Bank (1.14) and Maruti Suzuki (1.12). 

Among most active underlying, Reliance Industries witnessed an addition of 0.67 million of Open Interest in the September month futures contract, followed by State Bank of India witnessing a contraction of 0.06 million of Open Interest in the September month contract; while ICICI Bank witnessed an addition of 0.06 million of Open Interest in the September month futures contract, HDFC Bank witnessed an addition 0.53 million of Open Interest in the September month contract and Cipla witnessed an addition of 0.62 million of Open Interest in the September month's future contract