Nifty snaps two days winning streak; ends below 8,450 mark

Snapping its two days winning streak, Nifty closed in the negative territory as investors remained cautious ahead of Greece referendum on bailout proposal and US non-farm payrolls data to be released later in the day. Besides, weakness in Index heavyweights including Tata Motors and Infosys too weighed on the sentiment. On global front, Asian markets closed mostly in green, while Shanghai stocks closed lower after another volatile day despite regulators relaxing margin trading rules.  Further, European stocks were swung between gains and losses, with investors still nervously watching Greece’s negotiations with its creditors.

Back home, despite beginning the session on a positive note and trading in a tight range for most part of the session, the key gauge failed to snap the session in the positive territory. Sentiments remained dismal with global rating agency Fitch lowering India's economic growth projections to 7.8 percent for the current fiscal from 8 percent on pickup in demand and said that the country’s business environment is relatively weak compared with peers and will take time to turn around. The strength in the US labour market for the month of June, indicating a possibility of a Fed rate hike in September, also dampened sentiment. However, losses remained capped as significant buying was witnessed in Oil marketing companies such as Indian Oil Corp rose after crude oil prices slumped in the previous session. Lower prices in crude oil reduce the under-recoveries on local sales of LPG and kerosene at controlled prices. Some support also came after India Meteorological Department (IMD) reported better than normal monsoon figure in the month of June. Rains have been 16% above normal in June, resulting in an improvement in sowing patterns for major crops (pulses and oilseeds). Traders were seen piling position in Oil & Gas, Auto and Teck stocks while selling was witnessed in Metal, IT and infrastructure sector stocks.

The top gainers from the F&O segment were Hindustan Petroleum Corporation, Indiabulls Housing Finance and Indian Oil Corporation. On the other hand, the top losers were Aurobindo Pharma, Unitech and UCO Bank. In the index options segment, maximum OI was being seen in the 8400-8600 calls and 8000-7800 puts. In today's session, while the traders preferred to exit 8000 put, heavy buildup was seen in the 8200 put. On the other hand, traders exited from 8300 Call, while 8500 call witnessed considerable OI addition.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 1.81% and reached 15.55. The 50-share CNX Nifty was down by 8.15 points or 0.10% to settle at 8,444.90.

Nifty July 2015 futures closed at 8438.30 on Thursday at a discount of 6.60 points over spot closing of 8,444.90, while Nifty August 2015 futures ended at 8474.70 at a primium of 29.80  points over spot closing. Nifty July futures saw contraction of 0.05 million (mn) units, taking the total outstanding openinterest (OI) to 16.97 million (mn) units. The near month derivatives contractwill expire on July 30, 2015.

From the most active contracts, State Bank of India July2015 futures traded at premium of 1.10 points at 268.20 compared with spotclosing of 268.10. The number of contracts traded were 21,178.

ICICI Bank July 2015 futures traded at a premium of 0.30points at 313.30 compared with spot closing of 313.00. The number of contractstraded were 16,503.

Reliance Industries July 2015 futures traded at a premium of6.90 points at 1014.95 compared with spot closing of 1008.05. The number ofcontracts traded were 28,485.

HDFC Bank July 2015 futures traded at a discount of 2.40points at 1060.90 compared with spot closing of 1058.50. The number ofcontracts traded were 14,459.

Tata Motors July 2015 futures traded at a premium of 0.95points at 436.30 compared with spot closing of 435.35. The number of contractstraded were 15,094.

Among Nifty calls, 8600 SP from the July month expiry was the most active call with an addition of 2.74 million open interests.  Among Nifty puts, 8000 SP from the July month expiry was the most active put with a contraction of 0.66 million open interests.  The maximum OI outstanding for Calls was at 8500 SP (3.73 mn) and that for Puts was at 7900 SP (5.46 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8471.70 --- Pivot Point 8452.45 --- Support --- 8425.65.

The Nifty Put Call Ratio (PCR) finally stood at 1.42 for July month contract.  The top five scrips with highest PCR on OI were Just Dial (1.19), Eicher Motors (1.14), Maruti Suzuki (1.10), Asian Paint (1.09) and Divis Lab (1.08).

Among most active underlying, Reliance Industries witnessed an addition of 0.12 million of Open Interest in the July month futures contract, followed by Eicher Motors witnessing a contraction of 0.08 million of Open Interest in the July month contract; Axis Bank witnessed an addition of 0.02 million of Open Interest in the Julymonth contract, State Bank of India witnessed a contraction of 0.25 million of Open Interest in the July month contract and Hindustan Petroleum Corporation witnessed a contraction of 0.59 units of Open Interest in the July month's future contract.