Bulls take control over the market; Nifty reclaims 5,400 mark

Bulls hold their control throughout the day’s trade on Tuesday and Nifty ended remarkable day of trade with 1.30 percent gain recapturing its crucial 5,400 level as broad based buying witnessed ahead of key economic events like Railway budget, RBI monetary policy review meet, Indian Economic Survey and the Federal budget. Further, traders remained positive on the advance taxes that domestic companies are due to file by March 15. Data on advance tax is expected to hint at improved corporate earnings for Q4 March 2012. Globally, Asian and European markets were up ahead of American retail sales data and a policy decision by the Federal Reserve after the euro zone finance ministers signed off for a second bailout for Greece.

Buoyed by encouraging Asian cues, the Indian key benchmark made a gap-up start recapturing its 5,400 mark in initial trade. Afterwards, market extended its gains as traders remained hopeful about the advance taxes that domestic companies are due to file by March 15, and which some believe could hint at improved corporate earnings. Meanwhile, Auto stocks like Tata Motors, Maruti Suzuki and Bajaj Auto all edged higher as auto companies sales rose by 13 percent in February to 2,11,402 units, the highest pace of growth since April 2011. Firmness continued in early afternoon trade supported by European counters which opened on a firm note with Germany’s CAC leading the region, on hopes that German and US data will support rising hopes of an economic recovery ahead of a monetary policy statement by the Federal Reserve. Meanwhile, shares of realty companies extended their gains on expectations that the RBI will continue cutting interest rates in the upcoming months to support the slowing economy and lower interest rates are expected to help revive demand for properties. Market continued its jubilant run till end and snapped the day’s trade near its intraday high with a gain of about 70 points.

Meanwhile, all the sectoral indices on the NSE settled in the positive territory with CNX Metal gaining the most, up 2.95% followed by CNX Energy up by 2.30%, CNX Realty up by 2.29% and CNX PSE up by 1.89% in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, tumbled 5.78% and reached 24.75.

The India VIX witnessed contraction of 1.52% at 24.75 as compared to its previous close of at 26.27 on Monday.

The 50-share S&P CNX Nifty gain 69.95 points or 1.31% to settle at 5429.50Nifty March 2012 futures closed at 5,468.40 at a premium of 38.90 points over spot closing of 5,429.50, while Nifty April 2012 futures were at 5,507.00 at a premium of 77.50 points over spot closing. The near month March 2012 derivatives contract expires on Thursday, March 29, 2012. Nifty March futures saw an addition of 0.10 million (mn) units taking the total outstanding open interest (OI) to 25.08 mn units.

From the most active contract, Suzlon Energy March 2012 futures were at a premium of 0.20 point at 29.35 compared with spot closing of 29.15. The number of contracts traded was 10,282.

Reliance Communications March 2012 futures were at a premium of 0.65 point at 101.05 compared with spot closing of 100.40. The number of contracts traded was 8,934.

DLF March 2012 futures were at a premium of 1.10 at 209.45 compared with spot closing of 208.35. The number of contracts traded was 12,843.

HDIL March 2012 futures were at a premium of 0.55 point at 114.90 compared with spot closing of 114.35. The number of contracts traded was 12,611.

Tata Steel March 2012 futures were at a discount of 0.50 point at 468.70 compared with spot closing of 469.20. The number of contracts traded was 12,697.

Among Nifty calls, 5600 SP from the March month expiry was the most active call with an addition of 0.35 million open interest.

Among Nifty puts, 5200 SP from the March month expiry was the most active put with an addition of 0.62 million open interest.

The maximum OI outstanding for Calls was at 5600 SP (5.59mn) and that for Puts was at 5200 SP (8.17mn).

The respective Support and Resistance levels are: Resistance 5448.5-- Pivot Point 5419.65 -- Support 5400.65.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.20 for March -month contract.

The top five scrips with highest PCR on OI were ABGSHIP 8.90, DR REDDY 4.57, JP POWER 4.00, MARUTI 1.96 and SCI 1.86

Among most active underlying, Suzlon witnessed contraction of 1.59 million of Open Interest in the March month futures contract followed by IFCI which witnessed an addition of 1.04 million of Open Interest in the near month contract. Meanwhile, LITL witnessed an addition of 8.32 million in the March month futures. Also, GVKPIL witnessed an addition of 1.11 million in Open Interest in the March month contract. Finally, RCOM witnessed an addition of 1.78 million of Open Interest in the near month futures contract.