Nifty ends a volatile session with marginal gains

Nifty ended the day’s trade with marginal gains amid a volatile trading session led by Reliance Industries and private banking majors. However, market languished in the negative zone for most part of the day. Global cues supported sentiments as all Asian counters ended on a positive note barring Shanghai Composite. Asian markets advanced after Greek lawmakers approved a highly unpopular austerity bill in return for a second bailout from the European Union and International Monetary Fund to avoid a chaotic default. Back home, index heavyweight Reliance Industries gained over half a percent on reports that the company has signed a deal with France’s Dassault Aviation for partnering in the defence and homeland security sector in India.

A bout of volatility was witnessed in the initial trade and the domestic market reversed all of its initial gains triggered by higher Asian shares. Afterwards, market traded in the tight band near its neutral lines as benchmark remained in the consolidation mode. In the early afternoon trade, hefty bouts of selling pressure was seen which dragged the Nifty to its day’s low level as sentiments remained subdued after real estate major DLF, Tata Power along with Suzlon Energy, SAIL  and SBI got pounded heavily after announcing third quarter results which were below street’s expectations. But the index got strong support near its crucial 5,350 mark and regained its strength following firm start in European counters moreover; the morale of investors also got some boost after Coal India reported a good quarterly numbers and the market regained its crucial 5,400 mark. The state-run miner posted a better-than-expected 54 percent rise in its December-quarter net profit, helped by strong production volumes and a price increase effected last February. Meanwhile, shares of fertiliser companies were in focus on the bourses today, with many of them trading higher on back of huge volumes. National Fertilisers, Rashtriya Chemicals and Fertilisers, Zuari Industries and Chambal Fertilisers surged more than 5%. In the final half an hour of trade, profit booking in blue chip stocks was witnessed and market pared most of its gains. Finally, Nifty ended the volatile day of trade with a marginal gain of about 10 points.

On the global front, the US markets snapped their gaining streak on Friday, while All the Asian equity indices barring Shanghai Composite rose on Monday after Greece’s parliament approved a new set of austerity measures that were required by international lenders in exchange for an emergency bailout. Moreover, all the European counterparts were trading in the red where major indices like CAC, DAX and FTSE up by 0.50-1 percent at this point of time. Back home, most of the sectoral indices on the NSE settled in the positive territory with CNX Metal gaining the most, up by 1.10% followed by CNX Auto up by 0.93%, CNX MNC up by 0.47% while, CNX PSU Bank and CNX Media down by 0.94% and 0.93% respectively in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, dipped 0.50% and reached 23.71.

The India VIX witnessed a decline of 0.50% at 23.71 as compared to its previous close of at 23.83 on Friday.

The 50-share S&P CNX Nifty added 8.60 points or 0.16% to settle at 5,390.20.

Nifty February 2012 futures closed at 5,418.00 at a premium of 27.80 points over spot closing of 5,390.20, while Nifty March 2012 futures were at 5,449.35 at a premium of 59.15 points over spot closing. The near month February 2012 derivatives contract expires on Thursday, February 23, 2012. Nifty February futures saw contraction of 0.51 million (mn) units taking the total outstanding open interest (OI) to 24.73 mn units.

From the most active contract, IFCI February 2012 futures were at a premium of 0.15 point at 41.05 compared with spot closing of 40.90. The number of contracts traded was 11,693.

 Tata Motors February 2012 futures were at a premium of 0.10 point at 259.05 compared with spot closing of 258.95. The number of contracts traded was 14,185.

DLF February 2012 futures were at a premium of 0.45 point at 231.65 compared with spot closing of 231.20. The number of contracts traded was 19,378.

Tata Steel February 2012 futures were at a premium of 2.15 point at 487.45 compared with spot closing of 485.30. The number of contracts traded was 26,931.

SAIL February 2012 futures were at a premium of 0.20 point at 109.70 compared with spot closing of 109.50. The number of contracts traded was 17,964.

Among Nifty calls, 5500 SP from the February month expiry was the most active call with an addition of 0.23 million open interest.

Among Nifty puts, 5300 SP from the February month expiry was the most active put with an addition of 0.33 million open interest.

The maximum OI outstanding for Calls was at 5500 SP (7.21 mn) and that for Puts was at 5200 SP (7.11 mn).

The respective Support and Resistance levels are: Resistance 5423.7-- Pivot Point 5387.55-- Support 5387.55. The Nifty Put Call Ratio (PCR) OI wise stood at 1.69 for February -month contract.

The top five scrips with highest PCR on OI were Max India 178, Areva T&D 34, Canara Bank 7.83, Godrej Industries 7.11 and Patel Engineering 5.67.

Among most active underlying, IFCI witnessed an addition of 0.89 million of Open Interest in the February month futures contract followed by Tata Motors which witnessed a contraction of 0.30 million of Open Interest in the near month contract. Meanwhile Reliance Communication witnessed an addition of 0.62 million in the February month futures. Further, Hindalco Industries witnessed a contraction of 0.41 million in Open Interest in the February month contract. Finally, DLF Communications witnessed an addition of 0.07 million of Open Interest in the near month futures contract.