Nifty achieves record closing high; closes tad below 9000 mark

Extending its winning streak for the fourth day in a row, CNX Nifty ended the cheerful day of trade at all time closing high levels, even trading above the 9,000 level for a while for the first time ever, on sustained inflow of foreign capital amid growth-oriented and optimism over market-friendly measures in the Budget. Sentiment on the street improved after two key Finance Ministry officials said that the case for easing of interest rates by the Reserve Bank of India (RBI) had strengthened with inflation slowing and the focus staying on fiscal consolidation. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 424.79 crore on March 02, 2015. However, investors turned cautious after the release of two somber economic data points. On the macro-front, while Fiscal deficit exceeded budget estimates by 107% in 10 months, growth in eight core industries, contributing 38% to the overall industrial production slowed down to 1.8% in January, compared to by 3.7% in January 2014 and 2.4% in December 2014. On the global front, European shares rose close to seven-year highs as better than expected German retail sales further buoyed investors days before the European Central Bank (ECB) starts a trillion-euro bond-buying programme. The gains in Europe followed a rise in Asia and another record day on Wall Street.

Earlier, the local market made a cautious start and traded near its neutral line till mid afternoon trades as investors remained on the safer side awaiting clarity on the central bank’s stance on rate cuts. Later, the index resumed its north-ward journey supported by sustained buying among IT and pharma shares with index heavyweight Reliance Inds contributing the most to the gains after CLSA predicted that the company’s refining margins may rise to six year high. Last leg of trade brought some more cheer to the market and it touched its intraday high on hopes that the government’s move to make no distinction between foreign direct investment and foreign portfolio investment would raise India’s weight in MSCI indexes. Finally, Nifty ended the session near its crucial 9,000 mark with a gain of about half a percentage point.

The top gainers from the F&O segment were IDBI Bank, TVS Motor Company and Jain Irrigation Systems. On the other hand, the top losers were Eicher Motors, M&M and AXIS Bank. In the index options segment for March series, maximum OI continues to be seen in the 9100-9200 calls and 8600-8500 puts indicating the expected trading range.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 2.24% and reached 15.49. The 50-share CNX Nifty was up by 39.50 points or 0.44% to settle at 8,996.25. Nifty March 2015 futures closed at 9054.85 on Tuesday at a premium of 58.60 points over spot closing of 8996.25, while Nifty April 2015 futures ended at 9121.90 at a premium of 125.65 points over spot closing. Nifty March futures saw an addition of 1.23 million (mn) units, taking the total outstanding open interest (OI) to 27.81 million (mn) units. The near month derivatives contract will expire on March 26, 2015.

From the most active contracts, SBI March 2015 futures traded at a premium of 1.85 points at 304.65 compared with spot closing of 302.80. The number of contracts traded were 37,004.

ICICI Bank March 2015 futures traded at a premium of 1.30 points at 350.10 compared with spot closing of 348.80. The number of contracts traded were 21,213.

ITC March 2015 futures traded at a premium of 3.20 points at 344.35 compared with spot closing of 341.15. The number of contracts traded were 26,296.

HDFC Bank March 2015 futures traded at a premium of 16.35 points at 1097.55 compared with spot closing of 1081.20. The number of contracts traded were 18,700.

Reliance Industries March 2015 futures traded at a premium of 8.15 points at 908.30 compared with spot closing of 900.15. The number of contracts traded were 48,624.Among Nifty calls, 9100 SP from the March month expiry was the most active call with an addition of 0.20 million open interests. Among Nifty puts, 8800 SP from the March month expiry was the most active put with an addition of 0.47 million open interests. The maximum OI outstanding for Calls was at 9200 SP (4.93 mn) and that for Puts was at 8,500 SP (4.36 mn).  The respective Support and Resistance levels of Nifty are: Resistance 9027.92--- Pivot Point 8976.73--- Support --- 8945.07.

The Nifty Put Call Ratio (PCR) finally stood at 1.10 for March month contract. The top five scrips with highest PCR on OI were Siemens (1.20), Cairn (1.14), Mcleod Russel India (1.14), Grasim (1.08) and ACC (0.97). 

Among most active underlying, Reliance Industries witnessed an addition of 0.43 million of Open Interest in the March month futures contract, followed by State Bank of India witnessing an addition of 3.21 million of Open Interest in the March month contract; ITC witnessed an addition of 7.66 million of Open Interest in the March month contract, Axis Bank witnessed an addition of 0.43 million of Open Interest in the March month contract and Larsen & Toubro witnessed a contraction of 0.09 million of Open Interest in the March month's future contract.