Nifty snaps three days losing Streak; ends above 8250 mark

Snapping three days losing streak, the domestic index Nifty ended the day’s trade with a gain of 71 points reclaiming 8,250 mark led by blue-chip stocks such as ICICI Bank on value-buying. Today’s session was more like a rollercoaster ride, where the index opened positive and showed some strength in morning trades, but the sentiments turned pessimistic in early afternoon trades and index started drifting lower, however the market regained its momentum in the final hour of trade and finished the day gaining over half a percent. On the global front, Asian stocks ended mostly in red as sentiment gave way to caution ahead of the Federal Reserve's policy two-day meeting scheduled to start later in the session. Further, European stocks dropped in early trade, with Commerzbank dropping after announcing plans to raise €1.4 billion ($1.52 billion) and Swiss sanitary equipment maker Geberit slipping following poor results.

Back home, the market made a positive start as investors opted to buy beaten down but fundamentally strong stocks after three sessions of drubbing. Sentiments remained up-beat after World Bank said that India’s economy seems to have turned the corner and outlook has improved significantly, but even then it projected the economy to expand by 7.5 per cent during the current financial year, quite lower than the Budget assumption of 8.5 per cent. Some support came in with report that the foreign direct investment (FDI) in India jumped about 63 percent to $3.28 billion in February, 2015, compared to FDI of $ 2.01 billion in same period last year. In early afternoon session, market slipped in the negative territory as investors turned cautious ahead of the expiry of April derivatives contracts due on Thursday and the two-day meet of FOMC in which the Federal Reserve is likely to signal its stance on key policy rates. Further, in absence of any major cues, the market witnessed range bound trade in the mid-noon session as investors avoided taking long positions. However, some value buying in dying hours helped market to pare its losses and end the session above its crucial 8,250 mark with a gain of 71 points. Traders were seen piling positions in Banking, Auto and Realty stocks while selling was witnessed in FMCG, information technology (IT) and Consumer Durables sector stocks.

The top gainers from the F&O segment were ICICI Bank, Aurobindo Pharma and UPL. On the other hand, the top losers were Wockhardt, Just Dial and ITC. In the index options segment, maximum OI continues to be seen in the 8600-8500 calls and 8400-8300 puts indicating the expected trading range. In today's session, the 8100, 8200 and 8300 PUT strikes saw addition of 8.06, 5.44 and 3 lakh shares, respectively. On the other hand, 8200, 8300 and 8400 CALL strikes saw a contraction of 5.31, 6.57 and 4.60 lakh shares, respectively on the back of profit booking.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 7.07% and reached 17.41. The 50-share CNX Nifty was up by 71.80 points or 0.87% to settle at 8,285.60. Nifty April 2015 futures closed at 8292.40 on Tuesday at a premium of 6.80 points over spot closing of 8285.60, while Nifty May 2015 futures ended at 8349.35 at a premium of 63.75 points over spot closing. Nifty April futures saw contraction of 3.49 million (mn) units, taking the total outstanding open interest (OI) to 14.15 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 0.90 points at 326.55 compared with spot closing of 325.65. The number of contracts traded were 68,149.

State Bank of India April 2015 futures traded at a premium of 0.30 points at 272.75 compared with spot closing of 272.45. The number of contracts traded were 31,928.

Reliance Industries April 2015 futures traded at a premium of 5.00 points at 867.90 compared with spot closing of 862.90. The number of contracts traded were 51,369.

Axis Bank April 2015 futures traded at a premium of 2.70 points at 535.85 compared with spot closing of 533.15. The number of contracts traded were 40,561.

HDFC Bank April 2015 futures traded at a premium of 3.25 points at 1004.75 compared with spot closing of 1001.50. The number of contracts traded were 53,170.

Among Nifty calls, 8300 SP from the April month expiry was the most active call with a contraction of 0.65 million open interests. Among Nifty puts, 8200 SP from the April month expiry was the most active put with an addition of 0.54 million open interests. The maximum OI outstanding for Calls was at 8500 SP (4.69 mn) and that for Puts was at 8,200 SP (.15 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8334.02--- Pivot Point 8259.58--- Support --- 8211.17.

The Nifty Put Call Ratio (PCR) finally stood at 0.77 for April month contract. The top five scrips with highest PCR on OI were Maruti Suzuki (1.26), Mcleod Russel India (1.16), Cairn (1.10), MRF (1) and Tata Steel (0.98). 

Among most active underlying, ICICI Bank witnessed a contraction of 1.19 million of Open Interest in the April month futures contract, followed by Maruti Suzuki witnessing a contraction of 0.56 million of Open Interest in the April month contract; Reliance Industries witnessed a contraction of 6.99 million of Open Interest in the April month contract, HDFC Bank witnessed a contraction of 8.20 million of Open Interest in the April month contract and Infosys witnessed a contraction of 1.40 million of Open Interest in the April month's future contract.