Nifty remain downcast; observe another day of losses

The fifty stock index -- Nifty -- remained downcast for yet another session on Friday and extended their losses for the fifth consecutive day as the sluggish global markets sentiment and subdued corporate earnings season so far prompted investors to further pare their position in risky sectoral counters. On the global front, Asian equity markets ended mostly in red, on renewed speculation that the US Federal Reserve was going to raise interest rates before the end of the year. Bank of Japan decided to maintain its monetary stimulus program unchanged, keeping the current pace of asset purchases at about ¥80 trillion ($660 billion) annually. Further, European stocks were showing a mixed picture in early trade, as investors digest another day of earnings and tried to make sense of the noises coming from different central banks.

Back home, after getting a cautious but positive start, Indian benchmark nifty showed some strength in morning trade as investors got some support with report that the government has extended duty incentives to a large number of products, including textiles and electronics, to increase competitiveness of Indian exports and boost shipments.  Sentiments remained up-beat with the World Bank retaining its India's growth forecast at 7.5 percent in 2015-16, followed by a further acceleration to 7.8 percent in 2016-17 and 7.9 percent in 2017-18, saying it will continue to grow. But, the key gauge suffered a setback in afternoon trades as sudden bouts of profit booking emerged in the local markets, as disappointing results by some blue-chip companies are like ITC and Larsen & Toubro raised concerns about the health of the corporate sector. ITC was among the worst performers on Nifty with over 4 percent plunge in share prices after the company’s September quarter results missed street expectations posting a flat profit of Rs 2,431 crore and a revenue fall of over 1 percent to Rs 8,904 crore year-on-year basis. Traders were seen piling position in Banking, Power and Consumer Durables stocks, while selling was witnessed in Capital Goods, FMCG and Realty sector stocks. Finally, Nifty ended the trade with a cut of over half a percent near its intraday low breaching its psychological 8,100 mark.

The top gainers from the F&O segment were Bharat Forge, Glenmark Pharmaceuticals and Sun TV Network. On the other hand, the top losers were Apollo Tyres, Wockhardt and Just Dial. In the index options segment, maximum OI was being seen in the 8200-8500 calls and 7800-8200 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 1.69% and reached 17.88. The 50-share CNX Nifty was down by 45.95 points or 0.57% to settle at 8065.80. Nifty November 2015 futures closed at 8094.70 on Friday at a premium of 28.90 points over spot closing of 8,065.80, while Nifty December 2015 futures ended at 8135.85 at a premium of 70.05 points over spot closing. Nifty November futures saw addition of 0.94 million (mn) units, taking the total outstanding open interest (OI) to 18.77 million (mn) units. The near month derivatives contract will expire on November 26, 2015.  

From the most active contracts, SBI Bank November 2015 futures traded at premium of 0.90 points at 238.15 compared with spot closing of 237.25. The number of contracts traded were 12,835.    

ICICI Bank November 2015 futures traded at a premium of 1.80 points at 278.65 compared with spot closing of 276.85. The number of contracts traded were 34,567.      

Axis Bank November 2015 futures traded at a premium of 1.75 points at 477.25 compared with spot closing of 475.50. The number of contracts traded were 23,539.    

ITC November 2015 futures traded at a premium of 2.10 points at 336.45 compared with spot closing of 334.35. The number of contracts traded were 18,174.    

Yes Bank November 2015 futures traded at a premium of 6.00 points at 761.60 compared with spot closing of 755.60. The number of contracts traded were 12,303.       

Among Nifty calls, 8300 SP from the November month expiry was the most active call with an addition of 0.60 million open interests.  Among Nifty puts, 8000 SP from the November month expiry was the most active put with a contraction of 0.90 million open interests. The maximum OI outstanding for Calls was at 8200 SP (8.07 mn) and that for Puts was at 8100 SP (7.70 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8126.47--- Pivot Point 8085.43 --- Support --- 8024.77.

The Nifty Put Call Ratio (PCR) finally stood at 0.94 for November month contract.  The top five scrips with highest PCR on OI were Aditya Birla Nuvo (2.82), STAR (2.68), Marico (2), Shriram Transport Finance Company (1.70) and UBL (1.40).   

Among most active underlying, Larsen & Toubro witnessed an addition of 1.79 million of Open Interest in the November month futures contract, followed by ICICI Bank witnessing an addition of 3.57 million of Open Interest in the November month contract; ITC witnessed an addition of 1.17 million of Open Interest in the November month contract, Axis Bank witnessed a contraction of 0.09 million of Open Interest in the November month contract and Dr. Reddy's Laboratories witnessed an addition of 0.06 million units of Open Interest in the November month's future contract.