Nifty makes triple digit gains; closes above 8450 level

Making a smart bounce back, Nifty surged with triple digit gains on Monday, as the benchmark, after a positive start continued its strong momentum till the end of the session. On the global front, Asian stock indices ended higher as investors cheered Fed chief Janet Yellen's comments signaling that U.S. interest rates would rise only gradually. Chinese stocks soared on hopes for more economic stimulus measure. Meanwhile, most of European markets also made a positive opening in the early deals on Monday.

After a positive opening, market extended its gains on sustained buying witnessed in all key heavyweights along with broader indices. The index reclaimed its crucial 8,400 mark as investor sentiments got buoyed after global rating agency Fitch underscored that sustained fiscal consolidation, structural reforms and low inflation were positive for the country's ratings. Value-buying by funds in select bluechip stocks after recent losses amid a firming trend in other Asian markets, following weekend gains in US markets, buoyed trading sentiments at the market. Sentiments also got a boost with the reports that government is looking at a slew of measures including liberalising FDI norms for NRIs and manufacturing firms to sell products through e-commerce portals. Market extended its gain in the second half of trade and recaptured its psychological 8,450 level on account of buying in front line counters and taking cues from European counterparts. The optimism on the street continued despite the global ratings agency Standard and Poor's has said that capital spending in India is likely to take 12 more months to start recovering as private companies have adopted a ‘Wait-And-See’ approach. In the late afternoon session, market continued its positive trade and reached its intra-day high level. Rally in banking counters too aided the sentiments after Reserve Bank of India (RBI) proposed to lower the ceiling on how much a bank can lend to a single corporate group, in a move to curb risks in the banking sector at a time when bad loans are on the rise. Eventually, Nifty finished the session near its intraday high and just below its crucial 8,500 mark with a gain of over 150 points supported by index heavyweights viz, IDEA, UltraTech Cement, NMDC and Asian Paints.

The top gainers from the F&O segment were Hexaware Technologies, Aurobindo Pharma and Century Textiles & Industries. On the other hand, the top losers were Idea Cellular, Bharti Airtel and India Cements. In the index options segment, maximum OI continues to be seen in the 9000-8900 calls and 8500-8400 puts indicating the expected trading range. Meanwhile, all the sectoral indices on the NSE settled in the positive territory with CNX Finance gaining the most, ending with a gain of over two percent followed NX Realty up by 2.08% and CNX FMCG up by 1.90%.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 1.64% and reached 14.26. The 50-share CNX Nifty was up by 150.90 points or 1.81% to settle at 8,492.30.

Nifty April 2015 futures closed at 8557.50 on Monday at a premium of 65.20 points over spot closing of 8492.30, while Nifty May 2015 futures ended at 8611.40 at a premium of 119.10 points over spot closing. Nifty April futures saw a contraction of 1.16 million (mn) units, taking the total outstanding open interest (OI) to 20.12 million (mn) units. The near month derivatives contract will expire on April 30, 2015.

From the most active contracts, State Bank of India April 2015 futures traded at a premium of 1.00 points at 270.00 compared with spot closing of 269.00. The number of contracts traded were 20,085.

ICICI Bank April 2015 futures traded at a premium of 2.40 points at 321.05 compared with spot closing of 318.65. The number of contracts traded were 20,558.

HDFC Bank April 2015 futures traded at a premium of 9.95 points at 1048.45 compared with spot closing of 1038.50. The number of contracts traded were 17,414.

Reliance Industries April 2015 futures traded at a premium of 5.20 points at 819.30 compared with spot closing of 814.10. The number of contracts traded were 28,569.

Axis Bank April 2015 futures traded at a premium of 1.95 points at 567.40 compared with spot closing of 565.45. The number of contracts traded were 29,470.

Among Nifty calls, 8600 SP from the April month expiry was the most active call with an addition of 0.42 million open interests. Among Nifty puts, 8400 SP from the April month expiry was the most active put with an addition of 0.65 million open interests. The maximum OI outstanding for Calls was at 9000 SP (2.84 mn) and that for Puts was at 8,000 SP (2.37 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8537.65--- Pivot Point 8459.20--- Support --- 8413.85.

The Nifty Put Call Ratio (PCR) finally stood at 1.01 for April month contract. The top five scrips with highest PCR on OI were Petronet LNG (2.15), CESC (1.45), Sun TV (1.31), ACC (1.27) and Power Grid (1.22). 

Among most active underlying, Reliance Industries witnessed an addition of 0.07 million of Open Interest in the April month futures contract, followed by Axis Bank witnessing a contraction of 1.29 million of Open Interest in the April month contract; ICICI Bank witnessed a contraction of 1.34 million of Open Interest in the April month contract, State Bank of India witnessed a contraction of 1.11 million of Open Interest in the April month contract and Larsen & Toubro witnessed a contraction of 0.50 million of Open Interest in the April month's future contract.