Nifty ends on a flat note ahead of RBI's monetary policy on Tuesday

The local benchmark, Nifty consolidated and ended the choppy day of trade on a flat note on Monday as traders remained wary ahead of the RBI monetary policy review tomorrow, where it is widely expected to cut the repo rate by 25 basis points. Besides, weakness in healthcare shares also weighed on market with Sun Pharma contributing the most to the decline on weak earnings post the acquisition of Ranbaxy. On the global front, Asian markets closed mostly in red Monday, tracking the weak lead from Wall Street and amid concerns about the outlook for the ongoing Greek debt negotiations. However, European stocks rose in early trade, supported by a rally in pharmaceutical shares, but patchy manufacturing data and concerns surrounding Greece kept gains in check.

Back home, after getting a negative start, nifty were traded in small rage altering between positive and negative in morning session as investors engaged themselves in few stocks. Thereafter the index started moving upside and touched its intraday high on early afternoon trade as sentiments got support with report that India’s manufacturing PMI increased to a four-month high of 52.6 in May from 51.3 in April, with a reading above 50 signaling expansion. Some support also came with India’s gross domestic product (GDP) grew at 7.5% during the January-March period, faster than China’s 7% in the same period, mainly on account of improvement in services and manufacturing sectors. However, in the late afternoon session, nifty pared all its early gains and slipped into red with the report that the onset of monsoon in Kerala has been delayed. Although some final hour profit booking followed by mild short covering ensured the key gauge to end the session on a flat note with the negative bias. Traders were seen piling position in Capital Goods, Realty and FMCG stocks while selling was witnessed in Infrastructure, Banking and Auto sectors stocks.

The top gainers from the F&O segment were Bajaj Finance, Page Industries and Oil India. On the other hand, the top losers were Adani Enterprises, Sun Pharmaceuticals Industries and Adani Ports and Special Economic Zone. In the index options segment, maximum OI is being seen in the 8800-8600 calls and 8000-8200 puts. In today's session, while the traders preferred to exit 8100 put, heavy buildup was seen in the 8200 put. On the other hand, traders exited from 8300 Call, while 8600 call witnessed considerable OI addition.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 1.53% and reached 16.91. The 50-share CNX Nifty was down by 0.25 points to settle at 8,433.40. Nifty June 2015 futures closed at 8431.65 on Monday at a discount of 1.75 points over spot closing of 8,433.40, while Nifty July 2015 futures ended at 8468.05 at a premium of 34.65 points over spot closing. Nifty June futures saw an addition of 0.24 million (mn) units, taking the total outstanding open interest (OI) to 16.09 million (mn) units. The near month derivatives contract will expire on June 25, 2015.

From the most active contracts, State Bank of India June 2015 futures traded at a premium of 1.00 points at 279.20 compared with spot closing of 278.20. The number of contracts traded were 20,544.

HDFC Bank June 2015 futures traded at a premium of 8.75 points at 1043.95 compared with spot closing of 1035.20. The number of contracts traded were 16,010.

Reliance Industries June 2015 futures traded at a premium of 2.90 points at 904.95 compared with spot closing of 902.05. The number of contracts traded were 25,910.

Axis Bank June 2015 futures traded at a premium of 3.60 points at 582.20 compared with spot closing of 578.60. The number of contracts traded were 16,261.

Sun Pharmaceutical Industries June 2015 futures traded at a premium of 5.35 points at 883.40 compared with spot closing of 878.05. The number of contracts traded were 74,846.

Among Nifty calls, 8600 SP from the June month expiry was the most active call with an addition of 0.58 million open interests. Among Nifty puts, 8300 SP from the June month expiry was the most active put with an addition of 0.09 million open interests. The maximum OI outstanding for Calls was at 8800 SP (3.71 mn) and that for Puts was at 8,000 SP (4.27 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8465.23--- Pivot Point 8435.32--- Support --- 8403.48.

The Nifty Put Call Ratio (PCR) finally stood at 1.12 for June month contract. The top five scrips with highest PCR on OI were REC (1.58), MindTree (1.57), Bajaj-Auto (1.40), BHEL (1.39) and M&M (1.28). 

Among most active underlying, Adani Enterprises witnessed an addition of 0.88 million of Open Interest in the June month futures contract, followed by Sun Pharmaceuticals Industries witnessing an addition of 3.52 million of Open Interest in the June month contract; Larsen & Toubro witnessed a contraction of 0.18 million of Open Interest in the June month contract, Maruti Suzuki  witnessed a contraction of 0.04 million of Open Interest in the June month contract and State Bank of India witnessed an addition of 1.23 million of Open Interest in the June month's future contract.