Nifty ends lower amid feeble global cues

Domestic equity index -- Nifty ended lower on the Monday on account of sustained selling by funds and retail investors in the blue chip counters amid weal cues from the global markets, as Japan's Nikkei share average slumped 3 per cent after the yen hit a fresh 18-month high against the dollar. Investors’ sentiment remained under pressure with the private survey showing that India's manufacturing output rose at a slower pace in April as rise in new orders lost steam. The Nikkei purchasing managers’ index (PMI) survey showed that rate of manufacturing growth decreased to 50.50 in April from the eight-month high of 52.4 in March. Further, weakness also came in market on report that  report that exports of 17 sectors, over half of the 30 sectors including petroleum products, textiles, man-made yarn and fabrics, engineering and leather, closely monitored by the Commerce Ministry were in the negative zone in March due to a fall in global commodity prices amid tepid demand.

On the global front, Asian markets ended lower, as investors registered their disappointment over the lack of fresh stimulus from Japan's central bank. The surge in the Japanese yen and bleak readings from a monthly factory managers' survey did little to lighten the gloom. However, European markets were trading mostly higher Monday, as French and German shares show gains. 

Back home, after making a gap down opening, Indian equity benchmark has extended loss and breached its 7,800 mark, but some recovering which witnessed in noon deals for short period of time. Thereafter, market once again went down and continued to trade under pressure throughout the session. Finally, Nifty ended with cut of over 40 points. The top gainers from the F&O segment were Shriram Transport Finance Company, UPL and Dabur India. On the other hand, the top losers were ICICI Bank, Housing Development and Infrastructure and Punjab National Bank. In the index options segment, maximum OI was being seen in the 7800-8300 calls and 7000-7900 puts. In today's session, while the traders preferred to exit 7700 put, heavy buildup was seen in the 7500 put. On the other hand, traders exited from 7500 Call, while 8000 call witnessed considerable OI addition.   

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 3.36% and reached 17.09. The 50-share Nifty was down by 43.90 points or 0.56% to settle at 7,805.90.   

Nifty May 2016 futures closed 7840.10 on Monday at a premium of 34.20 points over spot closing of 7,805.90, while Nifty June 2016 futures ended at 7853.50 at a premium of 47.60 points over spot closing.  Nifty May futures saw contraction of 8.49 million (mn) units, taking the total outstanding open interest (OI) to 19.81 million (mn) units. The near month derivatives contract will expire on May 26, 2016.                         

From the most active contracts, SBI May 2016 futures traded at a premium of 0.60 points at 186.55 compared with spot closing of 185.95. The number of contracts traded were 13,094.    

Vedanta May 2016 futures traded at a premium of 0.95 points at 111.50 compared with spot closing of 110.55. The number of contracts traded were 15,468.              

ICICI Bank May 2016 futures traded at a premium of 1.15 points at 228.30 compared with spot closing of 227.15. The number of contracts traded were 24,924.          

Axis Bank May 2016 futures traded at a premium of 1.05 points at 473.15 compared with spot closing of 472.10. The number of contracts traded were 15,291.                                                       

HDFC Bank May 2016 futures traded at a premium of 9.60 points at 1126.40 compared with spot closing of 1,116.80. The number of contracts traded were 10,533.         

Among Nifty calls, 8000 SP from the May month expiry was the most active call with an addition of 0.78 million open interests. Among Nifty puts, 7800 SP from the May month expiry was the most active put with an addition of 0.008 million open interests. The maximum OI outstanding for Calls was at 8200 SP (4.45 mn) and that for Puts was at 7700 SP (3.97 mn). The respective Support and Resistance levels of Nifty are: Resistance 7831.37 --- Pivot Point 7804.33 --- Support --- 7778.87.            

The Nifty Put Call Ratio (PCR) finally stood at 0.92 for May month contract. The top five scrips with highest PCR on OI were Indian Overseas Bank (2.13), United Breweries (2.11), Container Corporation of India (1.55), PC Jeweller (1.25) and IRB Infrastructure Developers (1.13).  

Among most active underlying, ICICI Bank witnessed an addition of 0.76 million of Open Interest in the May month futures contract, followed UPL witnessing an addition of 1.41 million of Open Interest in the May month contract; Vedanta witnessed an addition of 4.70 million of Open Interest in the May month contract, Maruti Suzuki India witnessed a contraction of 0.04 million of Open Interest in the May month contract and Housing Development Finance Corporation witnessed an addition of 0.07 million units of Open Interest in the May month's future contract.