Nifty ends lower for third day in a row on Wednesday

The fifty stock shares -- Nifty -- ended lower on Wednesday, on account of selling in front line blue chip counters. Weakness in the global markets too dampened the sentiment after renewed declines in oil prices.  Further, Deprecation in Indian rupee along with selling by Foreign Institutional Investors also dampened the market. Besides, investors failed to get any sense of relief from the report that the India’s services sector activity touched a 19-month high in January driven by strengthening underlying demand and improved weather conditions, a monthly survey showed on Wednesday. The Nikkei Business Activity index climbed to a 19-month high of 54.3 last month from 53.6 in December, pointing to a marked expansion of activity across the sector. After getting a gap down opening, market continued to trade range bound for the most part day though selling got intensified in the last leg of trade that dragged the market intraday low level and finally market ended with cut of over a percent. 

On the global fornt, Asian markets ended mostly in red, as oil prices dropped for a third day, prompting investors to seek shelter in safe-haven assets and lifting bonds and gold to multi-month highs. European stocks were trading lower, as oil price volatility and concerns over global economic growth remained in focus.

The top gainers from the F&O segment were Bajaj Finance, Apollo Hospitals Enterprise and Hindustan Unilever.  On the other hand, the top losers were Crompton Greaves, Dish TV India and Unitech. In the index options segment, maximum OI was being seen in the 7400-8000 calls and 7000-7500 puts. In today's session, while the traders preferred to exit 7500 put, heavy buildup was seen in the 7100 put. On the other hand, traders exited from 7900 Call, while 7400 call witnessed considerable OI addition.   

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 3.06% and reached 18.58. The 50-share Nifty was down by 93.75 points or 1.26% to settle at 7,361.80.   

Nifty February 2016 futures closed 7383.50 on Wednesday at a premium of 21.70 points over spot closing of 7,361.80, while Nifty March 2016 futures ended at 7398.10 at a premium of 36.30 points over spot closing. Nifty February futures saw addition of 0.12 million (mn) units, taking the total outstanding open interest (OI) to 19.46 million (mn) units. The near month derivatives contract will expire on February 25, 2016.                

From the most active contracts, SBI February 2016 futures traded at a discount of 0.10 points at 166.75 compared with spot closing of 166.85. The number of contracts traded were 24,900.             

ICICI Bank February 2016 futures traded at a premium of 0.60 points at 204.70 compared with spot closing of 204.10. The number of contracts traded were 20,315.                      

Axis Bank February 2016 futures traded at a premium of 2.40 points at 382.40 compared with spot closing of 380.00. The number of contracts traded were 16,103.                          

Tata Steel February 2016 futures were trading flat compared with spot closing of 222.50. The number of contracts traded were 14,896.            

Reliance Industries February 2016 futures traded at a premium of 3.45 points at 983.45 compared with spot closing of 980.00. The number of contracts traded were 16,388.    

Among Nifty calls, 7500 SP from the February month expiry was the most active call with an addition of 0.19 million open interests. Among Nifty puts, 7300 SP from the February month expiry was the most active put with an addition of 0.32 million open interests. The maximum OI outstanding for Calls was at 7600 SP (4.52 mn) and that for Puts was at 7420 SP (3.88 mn). The respective Support and Resistance levels of Nifty are: Resistance 7404.03 --- Pivot Point 7377.17 --- Support --- 7334.93.        

The Nifty Put Call Ratio (PCR) finally stood at 0.95 for February month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (1.67), Indian Overseas Bank (1.37), Hero MotoCorp (1.35), Tata Consultancy Services (1.22) and Yes Bank (1.22).

Among most active underlying, Yes Bank witnessed an addition of 0.03 million of Open Interest in the February month futures contract, followed by Reliance Industries witnessing a contraction of 0.24 million of Open Interest in the February month contract; State Bank of India witnessed an addition of 0.47 million of Open Interest in the February month contract, Crompton Greaves witnessed an addition of 5.80 million of Open Interest in the February month contract and ICICI Bank witnessed an addition of 1.45 million units of Open Interest in the February  month's future contract.