Nifty slips below 5,450 mark on profit booking in rate sensitives

S&P CNX Nifty extended its losses for the third straight day on Friday, shrugging off positive global cues. The index traded in the negative for most part of the day and ended the session below its crucial 5,450 mark with a cut of about a percent on the back of profit taking among index heavyweights like Reliance Industries (RIL) and ONGC while, selling in realty and banking shares too dampened the sentiments. Though, global cues remained firm as most of the Asian equity indices edged higher and European counters too were trading in the green.

The domestic index opened on a flat note with Nifty swinging between negative and positive zone in initial trade. Afterwards, market turned red and extended its losses breaching its crucial 4,450 mark as investors booked their profits in stocks like ICICI Bank and HDFC Bank as market expectations for a rate cut in March tempered by the rally in world oil prices, which is likely to make it difficult for the central bank to ease policy. In addition, Brent crude climbed above $124, on track for a fifth straight weekly gain but upbeat US economic data offset concerns that high oil prices could snuff out demand. Later, market traded in the tight band but below its crucial 4,450 mark as there was no significant trigger in the market. Market witnessed little recovery and recaptured its psychological 4,450 level as European counters opened positive but firm trade in the European markets too failed to boost Indian market as sentiment continued to remain under pressure. Meanwhile, Index heavyweight RIL extended the initial losses, down by over 2 percent while, ONGC declined by nearly 2 percent after the stock gained post the government's announcement that it will divest stake in the exploration major through auction. Finally, Nifty snapped the session below its crucial 4,450 mark with a cur of over 50 points.

On the global front, the US markets ended higher overnight while, stocks in the Asian region ended mostly in the positive terrain on the last trading day of the week on the back of solid US data which boosted investors’ sentiment, but gains remained capped over concerns that rising oil prices could deal a further blow to the fragile euro zone economy and moves to take profits after recent rallies. However, most of the European counterparts were trading in the positive terrain where major indices CAC and DAX were trading with a gain of 0.5-1.5 percent at this point of time. Back home, most of the sectoral indices on the NSE were settled in the red, CNX Realty remained the major loser, down 2.59% followed by CNX PSU Bank down 1.96% and Bank Nifty down 1.93% while CNX Media and CNX Metal surged 1.69% and 1.10% respectively in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, rose 2.01% and reached 24.82.

The India VIX witnessed an addition of 2.01% at 24.82 as compared to its previous close of at 24.33 on Thursday.

The 50-share S&P CNX Nifty declined 54.00 points or 0.98% to settle at 5,429.30.

Nifty March 2012 futures closed at 5,487.45 at a premium of 58.15 points over spot closing of 5,429.30, while Nifty April 2012 futures were at 5,519.75 at a premium of 90.45 points over spot closing. The near month March 2012 derivatives contract expires on Thursday, March 29, 2012. Nifty March futures saw addition of 1.45 million (mn) units taking the total outstanding open interest (OI) to 25.38 mn units.

From the most active contract, STER March 2012 futures were at a premium of 1.05 point at 120.45 compared with spot closing of 119.40. The number of contracts traded was 17,353.

DLF March 2012 futures were at a premium of 2.55 point at 229.05 compared with spot closing of 226.50 The number of contracts traded was 12,542.

HDIL March 2012 futures were at a premium of 1.25 points at 109.4 compared with spot closing of 108.15 The number of contracts traded was 14,925.

RIL March 2012 futures were at a premium of 11.55 point at 831.4 compared with spot closing of 819.85. The number of contracts traded was 14,305.

HDFC March 2012 futures were at a premium of 3.4 point at 679.3 compared with spot closing of 675.90. The number of contracts traded was 31,360.

Among Nifty calls, 5700 SP from the March month expiry was the most active call with an addition of 0.64 million open interest. 

Among Nifty puts, 5300 SP from the March month expiry was the most active put with an addition of 0.83 million open interest.

The maximum OI outstanding for Calls was at 5700 SP (3.00 mn) and that for Puts was at 5300 SP (5.39 mn).

The respective Support and Resistance levels are: Resistance 5498.5-- Pivot Point 5452.2-- Support 5383

The Nifty Put Call Ratio (PCR) OI wise stood at 1.52 for February -month contract.

The top five scrips with highest PCR on OI were Punjab National Bank 4.08, Mangalore Refinery and Petrochemicals  (MRPL) 4.00, Siemens 1.70, HCL Technologies 1.40 and Maruti Suzuki 1.37.

Among most active underlying, Reliance Communication witnessed an addition of 0.93million of Open Interest in the March month futures contract followed by Tata Motors witnessed a contraction of 0.82 million of Open Interest in the near month contract. Meanwhile Sterlite Industries witnessed an addition of 4.16 million in the February month futures. Further, IDFC witnessed an addition of 0.62 million in Open Interest in the March month contract. Finally, DLF witnessed an addition of 0.93 million of Open Interest in the near month futures contract.