Nifty ends below 7,400 mark on Monday

The fifty stock index - Nifty - ended lower on Monday on account of sustained selling by fund and retail investors. Sentiment remained subdued with the report that India’s economic recovery is losing some steam and there is a likelihood of slowdown in the growth momentum. According to report, improving urban consumption demand and a robust transportation sector are supporting growth, however, weak external conditions and sluggish investment demand are weighing on the pace of the recovery. Traders failed to draw any sense of relief with statement of Finance Minister Arun Jaitley that the India continues to be one of the fastest growing economies in the world, but there is still potential to grow at a much faster pace. On the global front, European equities were trading lower on Monday, extending the previous week's steep losses, with cyclical sectors losing ground on persistent concerns about the pace of global economic growth. However, Japanese stocks rallied as the dollar strengthened in holiday-thinned trade today, with most markets across Asia closed for the Lunar New Year holiday. Back home, after getting flat to negative start, Nifty continued to see-saw around the neutral line for most part of the day, as traders remained on sidelines ahead of the GDP data for December quarter, which will be announced later in the day. Though, sharp selling was witnessed in the last leg of trade that dragged the Nifty below its psychological 7, 400 level and finally ended with loss of over 100 points.

The top gainers from the F&O segment were Jet Airways (India), Bank of India and Kaveri Seed Company. On the other hand, the top losers were Just Dial, Tata Motors and Petronet LNG. In the index options segment, maximum OI was being seen in the 7400-8100 calls and 6800-7500 puts. In today's session, while the traders preferred to exit 7500 put, heavy buildup was seen in the 6800 put. On the other hand, traders exited from 7200 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 11.83% and reached 20.25. The 50-share Nifty was down by 101.85 points or 1.36% to settle at 7,387.25.   

Nifty February 2016 futures closed 7393.45 on Monday at a premium of 6.20 points over spot closing of 7,387.25, while Nifty March 2016 futures ended at 7412.80 at a premium of 25.55 points over spot closing. Nifty February futures saw addition of 0.81 million (mn) units, taking the total outstanding open interest (OI) to 19.30 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 premium of 0.95 points at 172.35 compared with spot closing of 171.40. The number of contracts traded were 28,711.         

ICICI Bank February 2016 futures traded at a premium of 1.90 points at 208.25 compared with spot closing of 206.35. The number of contracts traded were 20,711.                      

Axis Bank February 2016 futures traded at a premium of 2.50 points at 408.90 compared with spot closing of 406.40. The number of contracts traded were 23,719.                          

Tata Steel February 2016 futures traded at a discount of 0.10 points at 234.90 compared with spot closing of 235.00. The number of contracts traded were 18,130.                                        

Reliance Industries February 2016 futures traded at a premium of 6.10 points at 965.75 compared with spot closing of 959.65. The number of contracts traded were 13,733. 

Among Nifty calls, 7600 SP from the January month expiry was the most active call with an addition of 1.01 million open interests. Among Nifty puts, 7400 SP from the January month expiry was the most active put with a contraction of 0.35 million open interests. The maximum OI outstanding for Calls was at 7600 SP (6.61 mn) and that for Puts was at 7400 SP (4.86 mn).  The respective Support and Resistance levels of Nifty are: Resistance 7478.80 --- Pivot Point 7421.00 --- Support --- 7329.45.        

The Nifty Put Call Ratio (PCR) finally stood at 0.90 for January month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (1.67), Eicher Motors (1.62), Tata Steel (1.35) PTC India (1.32), and TCS (1.25).

Among most active underlying, State Bank of India witnessed a contraction of 6.07 million of Open Interest in the January month futures contract, followed by Tata Steel witnessing a contraction of 1.53 million of Open Interest in the January month contract; Axis Bank witnessed a contraction of 2.47 million of Open Interest in the January month contract, Jet Airways (India) witnessed a contraction of 0.17 million of Open Interest in the January month contract and Reliance Industries witnessed an addition of 0.79 million units of Open Interest in the January month's future contract.