Nifty snaps three-day losing streak; ends above 7,400 mark

The fifty stock index -- Nifty --  snapped three-day losing streak and ended with the gains of over a percent on Tuesday tracking a firm trend across the global equities after data depicting China’s slowest growth since 2009 raised hopes of further government stimulus. A broad-based rally was witnessed across the bourses as participants bought battered blue -chips at attractive valuations. Sentiments remained upbeat from the beginning of trade with the report of India Ratings & Research that the Indian economy is expected to grow by 7.9 percent in the next fiscal and may progress at a similar pace over a couple of years extending beyond 2019.  It also added that the various macro parameters show that India has and is likely to perform better than its peers in the near term. Meanwhile, investors got additional boost with the rupee recovery, which snapping its three-day losing streak, edged higher against the dollar at the Interbank Foreign Exchange, on fresh selling of the American currency by exporters and banks. After getting a positive start, Nifty extended its gains and continued to trade with solid gains though out the session. On the global front, Asian markets ended in green, after data pointing to slower Chinese economic growth fanned stimulus hopes. European equities snapped a three-day decline tracking gains across the Asian peers. FTSE, CAC 40 and DAX were trading higher by 1.50% each. 

The top gainers from the F&O segment were Aditya Birla Nuvo, Engineers India and Reliance Capital.  On the other hand, the top losers were Bharti Infratel, MindTree and NMDC. In the index options segment, maximum OI was being seen in the 7400-8200 calls and 7000-7700 puts. In today's session, while the traders preferred to exit 7200 put, heavy buildup was seen in the 6900 put. On the other hand, traders exited from 7700 Call, while 7500 call witnessed considerable OI addition.  

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 8.88% and reached 18.43. The 50-share Nifty was up by 84.40 points or 1.14% to settle at 7,435.10.   

Nifty January 2016 futures closed 7438.10 on Tuesday at a premium of 3.00 points over spot closing of 7,435.10, while Nifty February 2016 futures ended at 7457.20 at a premium of 22.10 points over spot closing. Nifty January futures saw contraction of 0.43 million (mn) units, taking the total outstanding open interest (OI) to 20.81 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 0.10 points at 183.60 compared with spot closing of 183.50. The number of contracts traded were 23,453.           

ICICI Bank January 2016 futures traded at a discount of 1.20 points at 228.60 compared with spot closing of 229.80. The number of contracts traded were 16,739.                     

Axis Bank January 2016 futures traded at a discount of 2.30 points at 393.70 compared with spot closing of 396.00. The number of contracts traded were 22,363.                         

Reliance Industries January 2016 futures traded at a discount of 3.05 points at 1043.90 compared with spot closing of 1,046.95. The number of contracts traded were 25,336.           

Larsen & Toubro January 2016 futures traded at a premium of 2.60 points at 1123.60 compared with spot closing of 1,121.00. The number of contracts traded were 21,721.   

Among Nifty calls, 7500 SP from the January month expiry was the most active call with an addition of 0.52 million open interests. Among Nifty puts, 7400 SP from the January month expiry was the most active put with an addition of 0.03 million open interests. The maximum OI outstanding for Calls was at 7700 SP (5.86 mn) and that for Puts was at 7300 SP (6.42 mn).  The respective Support and Resistance levels of Nifty are: Resistance 7477.18 --- Pivot Point 7420.67 --- Support --- 7378.58.        

The Nifty Put Call Ratio (PCR) finally stood at 0.84 for January month contract. The top five scrips with highest PCR on OI were United Breweries (2.44), Mahindra & Mahindra Financial Services (1.64), Aditya Birla Nuvo (1.12), Tata Consultancy Services (0.97) and HDFC Bank (0.97). Among most active underlying, Reliance Industries witnessed a contraction of 0.06 million of Open Interest in the January month futures contract, followed by Aditya Birla Nuvo witnessing a contraction of 0.17 million of Open Interest in the January month contract; Infosys witnessed a contraction of 0.25 million of Open Interest in the January month contract, State Bank of India witnessed a contraction of 0.40 million of Open Interest in the January month contract and Reliance Infrastructure witnessed an addition of 0.12 million units of Open Interest in the January month's future contract.