Nifty snaps two session winning streak, closes with modest cut

Snapping its two-day winning run, NSE benchmark Nifty ended the session slightly in the red, weighed down by profit-booking in blue-chips. Investors remained cautious ahead of the first quarter earnings season, which will kick off with Tata Consultancy Services (TCS) announcing it April-June results on Thursday. Also, Index of Industrial Production (IIP) data for the month of May is scheduled to be released on July 10, 2015. On global front, Asian markets closed mostly in red on Tuesday with Shanghai closing down as analysts warned that government measures to staunch a recent rout will likely not be enough. Further, European stocks edged lower in early trade, with investors awaiting the outcome of an impromptu summit of eurozone leaders at which Greece will once again face its European creditors.

Back home, after gap up opening, nifty showed some strength in morning trades, but the sentiments turned pessimistic in late afternoon trades and index start drifting lower as investors turned cautious ahead of an emergency meeting of euro zone finance ministers in Brussels later in the day. The euro zone's ministers would discuss the steps they can take following Greece's rejection to the bailout terms. Trading sentiments weakened further with CRISIL Research’s report stating that India Inc is set to post disappointing quarter results for quarter ended June 30, on the back of soft commodity prices, weak growth in investment linked sectors and subdued rural earnings. Besides, weak cues from Asia and Europe markets, amid the ongoing developments in Greece, also dampened sentiment. However, losses remained capped with the government dismissing the possibility of any material impact on the Indian economy from the developments in Greece, but it anticipates some impact on the rupee from investors pulling out in fear. Commerce and Industry Minister Nirmala Sitharaman has said that the government is “very closely” monitoring the developments in Greece as that could have implications on the international currency market. Some support also came in from reports that foreign portfolio investors (FPIs) bought shares worth a net Rs 149.37 crore on July 06, 2015. 11.2% month-on-month, but was down by 42% year-on-year to $11.23 billion. Traders were seen piling position in Realty, Consumer Durables and PSU stocks while selling was witnessed in TECK, IT and Power sector stocks. Eventually, Nifty ended the session above its crucial 8,500 mark with a cut of eleven points.

The top gainers from the F&O segment were L&T Finance Holdings, Mcleod Russel India and Pidilite Industries. On the other hand, the top losers were HCL Technologies, Vedanta and NTPC. In the index options segment, maximum OI was being seen in the 8500-8500 calls and 7900-8100 puts. In today's session, while the traders preferred to exit 8200 put, heavy buildup was seen in the 8500 put. On the other hand, traders exited from 8500 Call, while 8800 call witnessed considerable OI addition.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 1.81% and reached 16.30. The 50-share CNX Nifty was down by 11.35 points or 0.13% to settle at 8,510.80. Nifty July 2015 futures closed at 8516.60 on Tuesday at a premium of 5.80 points over spot closing of 8,510.80, while Nifty August 2015 futures ended at 8554.80 at a primium of 44.00 points over spot closing. Nifty July futures saw addition of 0.85 million (mn) units, taking the total outstanding open interest (OI) to 18.59 million (mn) units. The near month derivatives contract will expire on July 30, 2015.

From the most active contracts, State Bank of India July 2015 futures traded at discount of 0.40 points at 273.40 compared with spot closing of 273.80. The number of contracts traded were 21,390.

L & T Finance Holdings July 2015 futures traded at a premium of 0.55 points at 72.45 compared with spot closing of 71.90. The number of contracts traded were 20,088.

ICICI Bank July 2015 futures traded at a premium of 0.75 points at 314.15 compared with spot closing of 313.40. The number of contracts traded were 19,295.

Reliance July 2015 futures traded at a premium of 4.60 points at 1008.75 compared with spot closing of 1,004.15. The number of contracts traded were 22,050.

HDFC Bank July 2015 futures traded at a premium of 3.70 points at 1088.70 compared with spot closing of 1,085.00. The number of contracts traded were 18,036.

Among Nifty calls, 8600 SP from the July month expiry was the most active call with an addition of 0.27 million open interests.  Among Nifty puts, 8300 SP from the July month expiry was the most active put with an addition of 0.41 million open interests.  The maximum OI outstanding for Calls was at 8500 SP (4.19 mn) and that for Puts was at 8200 SP (4.64 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8553.48 --- Pivot Point 8518.67 --- Support --- 8475.98.

The Nifty Put Call Ratio (PCR) finally stood at 1.45 for July month contract.  The top five scrips with highest PCR on OI were Dr. Reddys Laboratories (1.50), Just Dial (1.13), Asian Paint (1.10), Ultratech Cement (1.04) and JSW Steel (1.04).

Among most active underlying, Reliance Industries witnessed an addition of 0.18 million of Open Interest in the July month futures contract, followed by State Bank of India witnessing a contraction of 0.14 million of Open Interest in the July month contract; Hindustan Petroleum Corporation witnessed an addition of 0.19 million of Open Interest in the Julymonth contract, ICICI Bank witnessed a contraction of 1.59 million of Open Interest in the July month contract and Wockhardt witnessed an addition of 0.13 units of Open Interest in the July month's future contract.