Nifty skids lower for fifth consecutive day; ends below 8400 level

The fifty stock index -- Nifty -- continued its southward journey for fifth consecutive day on Tuesday and finished the volatile session of trade with a cut of about a percentage point. Sentiments remained downbeat on report that foreign portfolio investors (FPIs) sold shares worth a net Rs 1506.86 crore on April 20, 2015. On the global front, Asian stock indices ended mostly higher on Thursdays, drawing support from a rally in the U.S. markets overnight after China unveiled fresh stimulus to shore up the world’s second-largest economy. Furthermore, European stocks mostly rose in early trading, with strong earnings reports from some of the continent's biggest companies competing to set the tone with continued nervousness about Greece.

Back home, the Indian equity benchmark made a negative start on sustained selling by funds and retail investors coupled with weak corporate earnings figure. Besides, uncertainty over passage of Land Acquisition bill, weakness in the rupee and government's combative stance on retrospective taxation have kept the risk-appetite under check. However, traders found some comfort with the progress in the GST implementation on reports that the Centre and the states are working on a new revenue neutral rate, which is currently pegged at 27 percent. Nifty traded in a small range near its crucial 8,450 mark till early afternoon trades, but the selling pressure accentuated in the late afternoon as investors took to across the board selling after European markets reversed all their gains and were trading in the red. However, some value buying in dying hours helped the index to pare some of its losses, albeit end the session below its crucial 8,400 mark with a cut of 70 points. Traders were seen piling positions in Oil & Gas and PSU stocks, while sharp selling was witnessed in Realty, Capital Goods and Consumer Durables sector stocks.

The top gainers from the F&O segment were Godrej Industries, Century Textiles & Industries and Indiabulls Housing Finance. On the other hand, the top losers were Sun Pharmaceuticals Industries, DLF and Apollo Tyres. Meanwhile, India VIX - the gauge of underlying volatility in the market - has risen in today's session, which shows that traders are buying more options contracts as insurance against declines in the market.

In the index options segment, maximum OI continues to be seen in the 9000-8800 calls and 8600-8500 puts indicating the expected trading range. In today's session, the 8400, 8500 and 8600 Call strikes saw addition of 12.66, 13.46 and 3.35 lakh shares, respectively. On the other hand, 8900, 8800 and 8700 Put strikes saw a contraction of 1.11, 5.04 and 4.62 lakh shares, respectively on the back of profit booking.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 4.49% and reached 17.03. The 50-share CNX Nifty was down by 70.35 points or 0.83% to settle at 8,377.75.  Nifty April 2015 futures closed at 8400.45 on Tuesday at a premium of 22.70 points over spot closing of 8,377.75, while Nifty May 2015 futures ended at 8457.90 at a premium of 80.15 points over spot closing. Nifty April futures saw a addition of 1.03 million (mn) units, taking the total outstanding open interest (OI) to 21.46 million (mn) units. The near month derivatives contract will expire on April 30, 2015.

From the most active contracts, Sun Pharmaceuticals Industries April 2015 futures traded at a premium of 1.30 points at 954.35 compared with spot closing of 955.65. The number of contracts traded were 2,18,110.

State Bank of India April 2015 futures traded at a discount of 1.60 points at 289.8 compared with spot closing of 291.40. The number of contracts traded were 27,314.

HCL Technologies April 2015 futures traded at a discount of 4 points at 891 compared with spot closing of 895.00. The number of contracts traded were 34,190.

Axis Bank April 2015 futures traded at a discount of 1.40 points at 525.6 compared with spot closing of 527.00. The number of contracts traded were 27,414.

Yes Bank April 2015 futures traded at a premium of 0.20 points at 786.6 compared with spot closing of 786.40. The number of contracts traded were 17,950.

Among Nifty calls, 8500 SP from the April month expiry was the most active call with an addition of 1.34 million open interests. Among Nifty puts, 8400 SP from the April month expiry was the most active put with an addition of 0.05 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.80 mn) and that for Puts was at 8,300 SP (4.48 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8447.17--- Pivot Point 8399.93--- Support --- 8330.52.

The Nifty Put Call Ratio (PCR) finally stood at 0.82 for April month contract. The top five scrips with highest PCR on OI were Cairn (1.33), HCL Tech (1.05), MRF (1), BPCL (0.89) and Hexaware (0.86). 

Among most active underlying, Sun Pharmaceuticals Industries witnessed an addition of 1 million of Open Interest in the April month futures contract, followed by State Bank of India witnessing a contraction of 0.79 million of Open Interest in the April month contract; Reliance Industries witnessed an addition of 0.07 million of Open Interest in the April month contract, HCL Technologies witnessed an addition of 0.03 million of Open Interest in the April month contract and Axis Bank witnessed a contraction of 0.36 million of Open Interest in the April month's future contract.