Nifty ends choppy day of trade with slender gains

The local benchmark, Nifty consolidated and ended the choppy day of trade on a flat note on Monday. Sentiment got a hit as core sector output in the month of September slowed down to 1.9% as compared to 5.8% in August, lowest in eight months. Furthermore, India’s fiscal deficit widened to 82.6% to cross Rs 4.38 lakh crore during April-September this fiscal as against Rs 5.31 trillion Budget Estimates for 2014-15. However, losses remained capped with Finance Minister Arun Jaitley’s statement that economic growth in the current fiscal will be in the 5.5-5.9 per cent range and declining prices of crude oil and food will help lower inflation. Traders were seen piling positions in Realty, Bankex and Capital Goods sector while selling was witnessed in Consumer Durables, Auto and FMCG sector stocks.

After hitting record highs for third consecutive session and slipping into negative territory in early deals, the index seesawed around the neutral line for rest of the session as investors remained on the sidelines in the absence of any significant trigger at domestic front. However, some value buying in dying hours helped market to end the session in the green, above its crucial 8,300 mark.

The index, which has already rallied nearly 32 percent so far in the year 2014 to a new record high of 8350.60 in trade on Monday, is likely to continue its bull run as expectations are running high from the Indian markets given the fact that are macros are stabilised and growth has bottomed out. With the rate cycle set to reverse and more reforms getting implemented, the Indian markets may well be on top of list of FIIs (foreign institutional investors) despite global concerns.

The top gainers from the F&O segment were Unitech, JP Power and SKS Microfinance. On the other hand, the top losers were GAIL, Coal India and M&M. In the index options segment, maximum OI continues to be seen in the 8500-8400 calls and 8100-8000 puts indicating the expected trading range. Meanwhile, India VIX - the gauge of underlying volatility in the market - has risen in today's session as traders turned cautious after the benchmark breaches psychological level of 8300.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 3.32% and reached 13.73. The 50-share CNX Nifty increased by 1.95 points or 0.02% to settle at 8,324.15. Nifty November 2014 futures closed at 8361.05 on Monday at a premium of 36.90 points over spot closing of 8,324.15, while Nifty December 2014 futures ended at 8412.90 at a premium of 88.75 points over spot closing. Nifty November futures saw addition of 0.63 million (mn) units, taking the total outstanding open interest (OI) to 21.41 mn units. The near month derivatives contract will expire on November 27, 2014.

From the most active contracts, HDFC Bank November 2014 futures traded at a premium of 8.25 points at 920.05 compared with spot closing of 911.80. The number of contracts traded were 17,662.

Reliance Industries November 2014 futures traded at a premium of 6.65 points at 1008.10 compared with spot closing of 1001.45. The number of contracts traded were 24,696.

Tata Steel November 2014 futures traded at a premium of 1.95 points at 492.00 compared with spot closing of 490.05. The number of contracts traded were 18,020.

Reliance Capital November 2014 futures traded at a premium of 2.65 points at 492.15 compared with spot closing of 489.50. The number of contracts traded were 23,928.

ICICI Bank November 2014 futures traded at a premium of 2.80 points at 1647.65 compared with spot closing of 1644.85. The number of contracts traded were 16,849.

Among Nifty calls, 8400 SP from the October month expiry was the most active call with an addition of 0.43 million open interests. Among Nifty puts, 8,300 SP from the November month expiry was the most active put with an addition of 0.64 million open interests. The maximum OI outstanding for Calls was at 8500 SP (4.07 mn) and that for Puts was at 8,000 SP (5.17 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8350.62--- Pivot Point 8324.13 --- Support --- 8297.67.

The Nifty Put Call Ratio (PCR) finally stood at 1.27 for November month contract. The top five scrips with highest PCR on OI were Bajaj-Auto (1.39), Oriental Bank of Commerce (1.16), Axis Bank (1.16), Reliance Power (1.15) and DLF (1.13). 

Among most active underlying, Infosys witnessed a contraction of 0.02 million of Open Interest in the November month futures contract, followed by State Bank of India witnessing an addition of 0.08 million of Open Interest in the November  month contract; while Reliance Industries witnessed an addition of 0.23 million of Open Interest, ICICI Bank witnessed an addition of 0.29 million of Open Interest in the November month contract and Reliance Capital witnessed an addition of 0.01 million of Open Interest in the November month's future contract.