Nifty makes triple digit gains; closes above 8200 level

The local benchmark, Nifty witnessed exceptional recovery on Thursday by snapping its three-day losing streak and ended the day’s trade above its crucial 8,200 level gaining about a percent from its previous close. Sentiments got support as Finance Minister stressed that ongoing global slowdown is an opportunity for India after the US, while global investors are looking at domestic equities to invest. Appreciation in rupee value against the dollar also added to the optimistic sentiments. Some support also came as U.S. crude stopped a four-day skid and Germany left the door open to discussing options with Greece's next government on its debt. All the sectoral gauges on the NSE ended with good gains, and banks, infra and realty were the major gainers.

The benchmark got off to a positive start after sentiments were buttressed by the upbeat US jobs data and the release of the minutes of US Federal Reserve's meetings, which suggested that the proposed hike in key interest rates might not happen in near future. Besides, U.S. stocks jumped overnight, with the S&P 500 rebounding from a five-session dive, also supported the upside. Thereafter, the indices kept oscillating in a narrow range through the day’s trade. However, hefty short covering in the late hours helped the index to bounce to higher levels and ended the session with a gain of 132 points.

Going forward, the quarterly earnings season kick-starting with Infosys' results on 9^th of this month will set the tone till central bank's rate decision and the budget in February. In the index options segment, maximum OI continues to be seen in the 8400-8500 calls and 8000-8100 puts indicating the expected trading range. Meanwhile, some profit booking was seen in 8100, 8200 and 8300 Puts, which contracted by 2.54, 3.06 and 8.21 lakh shares, respectively. The top gainers from the F&O segment were Voltas, Asian Paints and TVS Motor Company. On the other hand, the top losers were Reliance Industries, Eicher Motors and United Breweries.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 9.19% and reached 16.47. The 50-share CNX Nifty was up by 132.50 points or 1.64% to settle at 8,234.60. Nifty January 2015 futures closed at 8257.25 on Thursday at a premium of 22.65 points over spot closing of 8234.60, while Nifty February 2015 futures ended at 8310.30 at a premium of 75.70 points over spot closing. Nifty January futures saw contraction of 0.91 million (mn) units, taking the total outstanding open interest (OI) to 17.79 mn units. The near month derivatives contract will expire on January 29, 2015.

From the most active contracts, State Bank of India January 2015 futures traded at a premium of 1.40 points at 306.65 compared with spot closing of 305.25. The number of contracts traded were 20,120.

ICICI Bank January 2015 futures traded at a premium of 1.70 points at 349.25 compared with spot closing of 347.55. The number of contracts traded were 20,668.

HDFC Bank January 2015 futures traded at a premium of 4.70 points at 969.20 compared with spot closing of 964.50. The number of contracts traded were 25,032.

Reliance Industries January 2015 futures traded at a premium of 4.10 points at 847.10 compared with spot closing of 843.00. The number of contracts traded were 26,694.

Tata Steel January 2015 futures traded at a premium of 1.95 points at 396.10 compared with spot closing of 394.15. The number of contracts traded were 15,695.Among Nifty calls, 8300 SP from the January month expiry was the most active call with a contraction of 0.82 million open interests. Among Nifty puts, 8,100 SP from the January month expiry was the most active put with an addition of 0.08 million open interests. The maximum OI outstanding for Calls was at 8400 SP (5.39 mn) and that for Puts was at 8,000 SP (6.29 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8262.97--- Pivot Point 8215.13--- Support --- 8186.77.

The Nifty Put Call Ratio (PCR) finally stood at 1.10 for January month contract. The top five scrips with highest PCR on OI were HUL (1.25), DLF (1.19), Grasim (1.17), BHEL (1.17) and Maruti Suzuki (1.16). 

Among most active underlying, Infosys witnessed a contraction of 0.5 million of Open Interest in the January month futures contract, followed by ICICI Bank witnessing a contraction of 3.86 million of Open Interest in the January month contract; State Bank of India witnessed a contraction of 0.74 million of Open Interest in the January month contract, Reliance Industries witnessed an addition of 0.72 million of Open Interest in the January month contract and Ashok Leyland witnessed a contraction of 0.52 million of Open Interest in the January month's future contract.