Nifty ends lower for second day in a row

Extending its southward journey for second straight day, CNX Nifty ended the session below 8,000 level with a cut of over one percent as Investors turned wary after the US Federal Reserve Chair Janet Yellen said a December rate hike could well be a 'live possibility'. Lackluster quarterly results and absence of any major positive triggers eroded investors' confidence. Besides, the rupee weakened 28 paise against the dollar to 65.77 on sustained capital outflows, also dampened the market sentiment. On the global front, Asian markets ended mostly in red as renewed rate hike talks and oil price volatility prompted investors to lock in quick profits, while Indonesia snapped three days of gains after lacklustre third-quarter economic data. European shares retreated on Thursday as commodity-related stocks were sold off heavily on a stronger dollar and some companies slumped after reporting disappointing results.

Back home, the benchmark got off to a somber opening, extending the downtrend for the second straight session as pessimistic sentiments prevailed across Asian markets. Thereafter, the key index failed to show any kind of fervor due to lack of encouraging leads. The key gauge suffered a setback in afternoon trades as caution prevailed across the mark ahead of the outcome of exit poll of Bihar election. Besides, the US Federal Reserve has revived the possibility of a December rate hike citing favorable growth in the US economy that has also dampened the sentiments of the market players. Investors failed to show any optimism with Finance Minister Arun Jaitley’s statement that first tranche of corporate tax reduction will be made when the next Finance Bill comes. He also hinted at a possible consensus on land acquisition bill and said the government is making efforts in that direction so that it could be taken up in the upcoming Winter Session. Sentiments remained subdued with the private report that indicate that India may have to import a large quantity of 10 million tonnes of pulses if the domestic production-consumption mismatch has to be bridged, leaving the government with a daunting task. Sectorally, all the sectors ended in red with CNX Realty and CNX Pharma indices slumping over 2% each. Bank Nifty index dropped heavily as well with 1.31% losses.

The top gainers from the F&O segment were Arvind, Coal India and Reliance Capital. On the other hand, the top losers were Ashok Leyland, Dish TV India and Unitech. In the index options segment, maximum OI was being seen in the 8200-8500 calls and 7800-8100 puts. In today's session, while the traders preferred to exit 8100 put, heavy buildup was seen in the 7800 put. On the other hand, traders exited from 8600 Call, while 8300 call witnessed considerable OI addition.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 0.32% and reached 19.29. The 50-share CNX Nifty was down by 84.75 points or 1.05% to settle at 7,955.45. Nifty November 2015 futures closed at 7989.40 on Thursday at a premium of 33.95 points over spot closing of 7,955.45, while Nifty December 2015 futures ended at 8033.90 at a premium of 78.45 points over spot closing. Nifty November futures saw addition of 0.35 million (mn) units, taking the total outstanding open interest (OI) to 19.07 million (mn) units. The near month derivatives contract will expire on November 26, 2015.  

From the most active contracts, SBI November 2015 futures traded at premium of 1.10 points at 235.10 compared with spot closing of 234.00. The number of contracts traded were 10,964.    

Ashok Leyland November 2015 futures traded at a premium of 0.50 points at 87.20 compared with spot closing of 86.70. The number of contracts traded were 15,851.       

ICICI Bank November 2015 futures traded at a premium of 1.10 points at 271.30 compared with spot closing of 270.20. The number of contracts traded were 11,490.    

Axis Bank November 2015 futures traded at a premium of 3.00 points at 466.50 compared with spot closing of 463.50. The number of contracts traded were 10,874.      

Tata Steel November 2015 futures traded at a premium of 1.05 points at 226.00 compared with spot closing of 224.55. The number of contracts traded were 11,261.    

Among Nifty calls, 8200 SP from the November month expiry was the most active call with an addition of 0.78 million open interests.  Among Nifty puts, 8000 SP from the November month expiry was the most active put with a contraction of 0.13 million open interests. The maximum OI outstanding for Calls was at 8300 SP (4.50 mn) and that for Puts was at 7800 SP (4.46 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8009.73--- Pivot Point 7976.92--- Support --- 7922.63.

The Nifty Put Call Ratio (PCR) finally stood at 0.93 for November month contract.  The top five scrips with highest PCR on OI were STAR (2.12), Shriram Transport Finance (1.52), Indian Overseas Bank (1.09), Titan Company (1.09) and Allahabad Bank (1.07).   

Among most active underlying, Ashok Leyland witnessed a contraction of 3.99 million of Open Interest in the November month futures contract, followed by Tata Motors witnessing an addition of 0.03 million of Open Interest in the November month contract; Jubilant Foodworks witnessed an addition of 0.45 million of Open Interest in the November month contract, Tata Steel witnessed an addition of 2.59 million of Open Interest in the November month contract and State Bank of India witnessed an addition of 1.07 million units of Open Interest in the November month's future contract.