Nifty snaps seven days losing streak; regains 8,550 mark

The fifty stock index -- Nifty -- snapped 7-day losing streak on Tuesday, the index rallied a bit intraday but could not hold all its gains till the end. Today’s session was more like a rollercoaster ride, where the index opened negative, then showed some strength in morning trades, but the sentiments turned pessimistic in late afternoon trades and index started drifting lower, however the market regained its momentum in the final hour of trade and finished the day gaining around half a percent.

The sentiments were on optimistic note from the early trade after Central Statistics Office (CSO) released advanced Gross Domestic Product (GDP) estimate, according to which the Indian economy is poised to grow by 7.4% in the current year, bettering 6.9% recorded last year. Some support also came in from Finance Minister Arun Jaitley statement that the government will make efforts to keep fiscal deficit within the targeted limit even as investments remain a challenge. However, the gains remained capped as traders turn cautious after weak earnings from some companies and prospects of the BJP losing in the Delhi state elections. In a near-sweep, the Aam Aadmi Party (AAP) today decimated BJP and Congress by recorded a landslide victory all set to secure 67 of the 70 seats in the Assembly elections, halting the Modi juggernaut in its tracks.

Most of the sectoral indices on the NSE settled in the positive territory with CNX PSU Bank gaining the most, ending with a gain of about two percent followed Bank Nifty up by 1.89% and CNX Auto up by 1.71%, while CNX IT down 0.71%, CNX Energy down 0.64% and CNX Media down by 0.24% remained the top losers on NSE sectoral space.

The top gainers from the F&O segment were Sun TV, Wockhardt and Hexaware Technologies. On the other hand, the top losers were Apollo Tyre, Reliance Infrastructure and Larsen & Toubro. In the index options segment for February series, maximum OI continues to be seen in the 9000-8900 calls and 8500-8400 puts indicating the expected trading range.  Meanwhile, India VIX - the gauge of underlying volatility in the market - has declined after the Delhi election event, but it’s going to remain elevated as market head toward the federal budget.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 3.73% and reached 21.19. The 50-share CNX Nifty was up by 39.20 points or 0.46% to settle at 8,565.55. Nifty February 2015 futures closed at 8611.40 on Tuesday at a premium of 45.85 points over spot closing of 8565.55, while Nifty March 2015 futures ended at 8670.75 at a premium of 105.20 points over spot closing. Nifty February futures saw an addition of 0.13 million (mn) units, taking the total outstanding open interest (OI) to 24.94 million (mn) units. The near month derivatives contract will expire on February 26, 2015.

From the most active contracts, ICICI Bank February 2015 futures traded at a premium of 0.75 points at 332.65 compared with spot closing of 331.90. The number of contracts traded were 38,951.

State Bank of India February 2015 futures traded at a discount of 0.80 points at 288.95 compared with spot closing of 289.75. The number of contracts traded were 42,703.

HDFC Bank February 2015 futures traded at a premium of 5.60 points at 1061.40 compared with spot closing of 1055.80. The number of contracts traded were 31,815.

Reliance Industries February 2015 futures traded at a premium of 3.25 points at 887.85 compared with spot closing of 884.60. The number of contracts traded were 26,060.

Axis Bank February 2015 futures traded at a premium of 0.75 points at 557.05 compared with spot closing of 556.30. The number of contracts traded were 41,809.Among Nifty calls, 8700 SP from the February month expiry was the most active call with a contraction of 0.49 million open interests. Among Nifty puts, 8500 SP from the February month expiry was the most active put with an addition of 0.31 million open interests. The maximum OI outstanding for Calls was at 9000 SP (6.17 mn) and that for Puts was at 8,600 SP (3.28 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8651.03--- Pivot Point 8560.77--- Support --- 8475.28.

The Nifty Put Call Ratio (PCR) finally stood at 0.85 for February month contract. The top five scrips with highest PCR on OI were Bata India (1.72), HCL Tech (1.16), HDIL (1.13), Infosys (1.09) and ACC (0.93). 

Among most active underlying, Larsen & Toubro witnessed an addition of 0.16 million of Open Interest in the February month futures contract, followed by ICICI Bank witnessing a correction of 0.43 million of Open Interest in the February month contract; State Bank of India witnessed a correction of 3.23 million of Open Interest in the February month contract, Axis Bank witnessed an addition of 1.06 million of Open Interest in the February month contract and Reliance Industries witnessed an addition of 0.38 million of Open Interest in the February month's future contract.