Nifty ends lower amid weak Asian cues

After a choppy session, CNX Nifty has ended in negative terrain led by declines in domestic-oriented stocks on worries that the remaining January-March quarterly earnings may not meet market expectations. On the global front, Asian markets closed mostly in red as concerns over slowing economic growth in China and a firmer dollar kept investors on edge amid a quiet day on the economic front. Further, Reserve Bank of Australia has cut interest rates for the second time this year, but most investors took this as a sign that the easing cycle has drawn to a close.

Back home, the market got off to a cautious but positive start and lost some ground in early morning trade on absence of any positive triggers amid mixed regional counters. Investors turned cautious on a private report that the level of optimism about business environment among chief financial officers in the country declined in April-June period largely owing to slower pace of reforms than initially expected and weak profit level of the corporates. However, in later deals the index started showing recovery on value buying activities by market-participants. Sentiments got a boost with the report that Mutual fund managers pumped in over Rs 7,600 crore in equity markets in April, making it their highest net inflow in more than seven years, mainly on account of positive investor sentiment and the government’s reforms agenda.  Some support also came in from finance minister Arun Jaitley statement that the government has initiated a large number of reforms in its first year of governance to encourage investments and the country has the potential to grow at 9-10%. The index traded near neutral line for most part of the day, lacking any significant upside triggers as investors engaged themselves in few stocks. However, selling pressure accentuated in the late afternoon as investment bank Credit Suisse cut the NSE index earning estimates for FY16 and FY17 by 2 per cent and 1 per cent, respectively. Nevertheless, some value buying in dying hours helped the index to pare some of its losses, albeit end the session with a marginal cut of 7 points. Traders were seen piling positions in Metal, Oil & Gas and Realty stocks, while sharp selling was witnessed in Power, Consumer Durables and Infrastructure sector stocks

The top gainers from the F&O segment were Reliance Communications, Kotak Mahindra Bank and Sesa Sterlite. On the other hand, the top losers were Century Textiles & Industries, Siemens and TVS Motor Company. In the index options segment, maximum OI continues to be seen in the 8600-8500 calls and 8200-8100 puts indicating the expected trading range. In today's session, the 8400, 8500 and 8600 CALL strikes saw addition of 3.34, 4.19 and 2.38 lakh shares, respectively. On the other hand, 7900, 7800 and 7700 PUT strikes saw an addition of 1.70, 2.06 and 4.32 lakh shares, respectively.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 0.33% and reached 17.36. The 50-share CNX Nifty was down by 7.15 points or 0.09% to settle at 8,324.80.

Nifty May 2015 futures closed at 8361.70 on Tuesday at a premium of 36.90 points over spot closing of 8,324.80, while Nifty June 2015 futures ended at 8393.80 at a premium of 69.00 points over spot closing. Nifty May futures saw contraction of 1.54 million (mn) units, taking the total outstanding open interest (OI) to 16.79 million (mn) units. The near month derivatives contract will expire on May 28, 2015.

From the most active contracts, Reliance Industries May 2015 futures traded at a discount of 4.20 points at 886.95 compared with spot closing of 891.15. The number of contracts traded were 29,180.

Axis Bank May 2015 futures traded at a premium of 3.65 points at 568.25 compared with spot closing of 564.60. The number of contracts traded were 26,997.

ONGC May 2015 futures traded at a premium of 1.70 points at 343.50 compared with spot closing of 341.80. The number of contracts traded were 30,383.

Sun Pharmaceutical Industries May 2015 futures traded at a premium of 5.20 points at 963.70 compared with spot closing of 958.50. The number of contracts traded were 22,118.

Tata Steel May 2015 futures traded at a premium of 2.00 points at 381.85 compared with spot closing of 379.85. The number of contracts traded were 29,684.

Among Nifty calls, 8400 SP from the May month expiry was the most active call with an addition of 0.41 million open interests. Among Nifty puts, 8200 SP from the May month expiry was the most active put with a contraction of 0.06 million open interests. The maximum OI outstanding for Calls was at 8600 SP (3.87 mn) and that for Puts was at 8,100 SP (3.57 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8360.10--- Pivot Point 8320.35 --- Support --- 8285.05.

The Nifty Put Call Ratio (PCR) finally stood at 1.03 for May month contract. The top five scrips with highest PCR on OI were Rural Electrification Corporation (1.72), Sun TV (1.14), ACC (1.07), India Cements (1.03) and Jubilant Foodworks (1.02). 

Among most active underlying, Kotak Mahindra Bank witnessed an addition of 0.18 million of Open Interest in the May month futures contract, followed by Reliance Industries witnessing a contraction of 0.74 million of Open Interest in the May month contract; Century Textiles & Industries witnessed an addition of 0.13 million of Open Interest in the May month contract, Axis Bank witnessed an addition of 0.13 million of Open Interest in the May month contract and Larsen & Toubro witnessed a contraction of 0.07 million of Open Interest in the May month's future contract.