Nifty makes a good start of the week; reclaims 8800 level

It was a good day of trade for the markets to start the new week, though choppiness persisted ahead of the CPI inflation data, slated to be announced later in the day but traders went for value buying and took the Nifty above the crucial psychological 8800 mark, the highest closing level in six weeks. There was late hour rally in bluechips that helped the markets recover from the lows of the day. Global factors too supported the upmove to some extent, as weak Chinese trade data intensified expectations for more economic stimulus measures from Beijing. Though traders were cautiously eyeing the CPI numbers to be announced today and the WPI numbers slated for tomorrow. Indian markets will be closed for a public holiday on Tuesday but corporate earnings are going to be the next medium-term trigger for the markets.

Sectorally, most of the indices made a green close on Monday, led by CNX Infra up by 1.95%, CNX Pharma up by 1.61%, CNX Energy up by 1.26%, CNX FMCG up by 1.14% and CNX Consumption up by 0.73%. On the other hand, some somberness was witnessed in CNX Auto down by 0.69% and Bank Nifty down by 0.01%.

The top gainers from the F&O segment were Idea Cellular, Bharti Airtel and BHEL. On the other hand, the top losers were M&M, ACC and Tata Motors. In the index options segment, maximum OI continues to be seen in the 8900-9200 calls and 8400-8700 puts indicating the expected trading range. The Nifty futures contract has begun the week on a strong note and the outlook will turn negative only if the contract breaks below 8,800.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 1.63% and reached 14.48. The 50-share CNX Nifty was up by 53.65 points or 0.61% to settle at 8,834.00.

Nifty April 2015 futures closed at 8855.45 on Monday at a premium of 21.45 points over spot closing of 8,834.00, while Nifty May 2015 futures ended at 8901.15 at a premium of 67.15 points over spot closing. Nifty April futures saw contraction of 0.34 million (mn) units, taking the total outstanding open interest (OI) to 18.77 million (mn) units. The near month derivatives contract will expire on April 30, 2015.

From the most active contracts, ICICI Bank April 2015 futures traded at a premium of 1.80 points at 318.80 compared with spot closing of 317.00. The number of contracts traded were 14,608.

State Bank of India April 2015 futures traded at a premium of 1.30 points at 286.80 compared with spot closing of 285.50. The number of contracts traded were 18,330.

HDFC Bank April 2015 futures traded at a premium of 4.00 points at 1043.00 compared with spot closing of 1039.00. The number of contracts traded were 13,766.

Reliance Industries April 2015 futures traded at a premium of 2.15 points at 924.45 compared with spot closing of 922.30. The number of contracts traded were 35,497.

Axis Bank April 2015 futures traded at a premium of 3.15 points at 568.50 compared with spot closing of 565.35. The number of contracts traded were 21,402.

Among Nifty calls, 9000 SP from the April month expiry was the most active call with an addition of 0.09 million open interests. Among Nifty puts, 8800 SP from the April month expiry was the most active put with an addition of 1.22 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.23 mn) and that for Puts was at 8,500 SP (4.89 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8863.07--- Pivot Point 8812.58--- Support --- 8783.52.

The Nifty Put Call Ratio (PCR) finally stood at 1.38 for April month contract. The top five scrips with highest PCR on OI were Mindtree (1.55), Dr. Reddy's Laboratories (1.28), HDIL (1.21), Bharti Airtel (1.19) and Mcleod Russel India (1.16). 

Among most active underlying, Reliance Industries witnessed an addition of 0.39 million of Open Interest in the April month futures contract, followed by HDIL witnessing an addition of 1.51million of Open Interest in the April month contract; L&T witnessed an addition of 0.16 million of Open Interest in the April month contract, State Bank of India witnessed an addition of 1.10 million of Open Interest in the April month contract and Century Textile witnessed an addition of 1.10 million of Open Interest in the April month’s future contract.