Nifty snaps four days winning streak; ends below 8,950 mark

Erasing the previous session’s gains, CNX Nifty ended the session below its crucial 8,950 level with a cut of over half a percent on as funds and retail investors indulged in booking profits at prevailing levels. Besides, a weakening trend on the other Asian markets following overnight losses on the US bourses also influenced the sentiment. Today’s session was one of the volatile session where nifty swing over 225 point, starting from all time high level above 9100 mark and ended on lower level below 8,950 level.  Earlier, Sentiments got a boost after the RBI chief Raghuram Rajan in a surprise move decided to cut repo rate by 25 basis points. The repo rate cut came just days after Finance Minister Arun Jaitley's Union Budget announcement. In his Budget, Mr Jaitley had loosened the reins on public spending to drive growth, but promised lower-than-expected borrowing despite raising the fiscal deficit target. Some support also came with services sector expanded rapidly in February at the fastest growth rate in eight months on the back of significant rise in new business orders even as jobs fell marginally in the sector. HSBC India Services Business Activity Index, which tracks changes in activity at Indian services companies on a monthly basis, rose to 53.9 in February as against 52.4 in the previous month. However, profit-booking wiped out the day's gains in the fag-end of the trading session. Furthermore, traders turn cautious ahead of a European Central Bank meeting on Thursday and the all-important U.S. jobs report due out Friday, which could provide some clues about the timing of the Federal Reserve's interest rate hike this year.

After opening at all-time high level, domestic index nifty trimed some gains and traded in the tight range till mid afternoon trade, but it was the final hour of trade where market witnessed steep fall of about 140 points from the day's high and ended the session below its crucial 8,950 mark with a cut of over half a percent.

Most of the sectoral indices on the NSE settled in the negative territory with CNX PSU Bank loosing the most, ending with a loss of 3.04 present followed CNX Metal down by 2.57 present and Bank Nifty down by 1.59 present, while CNX Pharma up 1.32 present and CNX FMCG up by 0.40 present remained the top gainers on NSE sectoral space.

The top gainers from the F&O segment were Ranbaxy, JP Associate and Sun Pharma. On the other hand, the top losers were Jain Irrigation Systems, IDBI and SSLT. 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 1.90% and reached 15.19. The 50-share CNX Nifty was down by 73.60 points or 0.82% to settle at 8,922.65. Nifty March 2015 futures closed at 8956.35 on Wednesday at a premium of 33.70 points over spot closing of 8922.65, while Nifty April 2015 futures ended at 9024.20 at a premium of 101.55 points over spot closing. Nifty March futures saw contraction of 0.92 million (mn) units, taking the total outstanding open interest (OI) to 26.89 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 2.75 points at 295.50 compared with spot closing of 292.75. The number of contracts traded were 82,730.

ICICI Bank March 2015 futures traded at a premium of 2.05 points at 350.30 compared with spot closing of 348.25. The number of contracts traded were 45,112.

ITC March 2015 futures traded at a premium of 1.85 points at 346.95 compared with spot closing of 345.10. The number of contracts traded were 38,095.

HDFC Bank March 2015 futures traded at a premium of 9.00 points at 1076.20 compared with spot closing of 1067.20. The number of contracts traded were 36,313.

Reliance Industries March 2015 futures traded at a premium of 6.55 points at 892.80 compared with spot closing of 886.25. The number of contracts traded were 28,430.

Among Nifty calls, 9100 SP from the March month expiry was the most active call with an addition of 0.09 million open interests. Among Nifty puts, 9000 SP from the March month expiry was the most active put with an addition of 0.52 million open interests. The maximum OI outstanding for Calls was at 9200 SP (4.05 mn) and that for Puts was at 8,500 SP (4.35 mn).  The respective Support and Resistance levels of Nifty are: Resistance 9063.25--- Pivot Point 8978.60--- Support --- 8838.00.

The Nifty Put Call Ratio (PCR) finally stood at 1.12 for March month contract. The top five scrips with highest PCR on OI were Ranbaxy (1.21), Siemens (1.12), Grasim (1.12), ACC (1.06) and Sun TV (0.94). 

Among most active underlying, State Bank of India  witnessed an addition of 3.93 million of Open Interest in the March month futures contract, followed by Axis Bank witnessing a contraction of 1.07 million of Open Interest in the March month contract; ICICI Bank witnessed a contraction of 1.59 million of Open Interest in the March month contract, ITC witnessed an addition of 2.39 million of Open Interest in the March month contract and Larsen & Toubro witnessed a contraction of 0.80 million of Open Interest in the March month's future contract.