Nifty tumbles lower for fourth day in a row; ends below 7600 mark

The fifty stock index - Nifty - ended lower for fourth day in a row on Thursday after China accelerated the depreciation of the yuan, sparking sharp falls in regional equity and currency markets. China also suspended its stock markets for the rest of the day less than half an hour after opening as a new circuit-breaking mechanism was tripped for the second time this week. Sentiment remained subdued with report that the World Bank lowered its global economic growth forecast for 2016 to 2.9% against its June forecast of 3.3% growth because of sluggish performance from major emerging market economies. Besides, the weakness in the rupee against the American currency too weighed on the sentiment. On the global front, Asian market ended in red, as worries intensified about China’s economy and whether authorities had lost their grip on the market. European markets were trading in red with a cut of around 3 percent in early deals.  Back home, after getting gap down opening, Indian equity Nifty continued to bleed throughout the day’s and finally ended with a massive cut of 172 points.

The top gainers from the F&O segment were Godrej Industries and Aditya Birla Nuvo. On the other hand, the top losers were Jindal Steel & Power, Indiabulls Real Estate and Vedanta. In the index options segment, maximum OI was being seen in the 7600-8300 calls and 7200-7800 puts. In today's session, while the traders preferred to exit 7700 put, heavy buildup was seen in the 7400 put. On the other hand, traders exited from 8250 Call, while 7600 call witnessed considerable OI addition. 

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 14.54% and reached 18.96. The 50-share Nifty was down by 172.70 points or 2.23% to settle at 7,568.30.    

Nifty January 2016 futures closed at 7582.05 on Thursday at a premium of 13.75 points over spot closing of 7,568.30, while Nifty February 2016 futures ended at 7606.65 at a premium of 38.35 points over spot closing. Nifty January futures saw addition of 0.76 million (mn) units, taking the total outstanding open interest (OI) to 21.57 million (mn) units. The near month derivatives contract will expire on January 28, 2016.              

From the most active contracts, SBI January 2016 futures traded at a premium of 0.05 points at 209.80 compared with spot closing of 209.75. The number of contracts traded were 16,338.                 

Axis Bank January 2016 futures traded at a premium of 1.50 points at 410.50 compared with spot closing of 409.00. The number of contracts traded were 18,878.                      

Tata Steel January 2016 futures traded at a discount of 0.45 points at 250.55 compared with spot closing of 251.00. The number of contracts traded were 14,668.       

Tata Motors January 2016 futures traded at a discount of 0.90 points at 343.90 compared with spot closing of 344.80. The number of contracts traded were 14,211.                        

 Reliance Industries January 2016 futures traded at a discount of 2.18 points at 1016.10 compared with spot closing of 1,018.90. The number of contracts traded were 19,228.     

Among Nifty calls, 7800 SP from the January month expiry was the most active call with an addition of 0.96 million open interests. Among Nifty puts, 7500 SP from the January month expiry was the most active put with an addition  of 0.28 million open interests. The maximum OI outstanding for Calls was at 8000 SP (6.11 mn) and that for Puts was at 7500 SP (5.94 mn).  The respective Support and Resistance levels of Nifty are: Resistance 7643.30 --- Pivot Point 7599.95 --- Support --- 7524.95.  

The Nifty Put Call Ratio (PCR) finally stood at 0.93 for January month contract. The top five scrips with highest PCR on OI were United Breweries (13.50), Mahindra & Mahindra Financial Services (2.34), HCL Technologies (1.77), Indian Overseas Bank (1.33) and Ajanta Pharma (1.13).  

Among most active underlying, Reliance Infrastructure witnessed a contraction of 0.46 million of Open Interest in the January month futures contract, followed by Reliance Industries witnessing an addition of 0.29 million of Open Interest in the January month contract; Maruti Suzuki India witnessed an addition of 0.13 million of Open Interest in the January month contract, Tata Steel  witnessed a contraction of 0.75 million of Open Interest in the January month contract and Tata Motors witnessed a contraction of 0.09 million units of Open Interest in the January month's future contract.