Nifty ends with marginal gain on Wednesday

Domestic equity index -- Nifty ended with modest gain as investors remained on sidelines and refrained from any buying activity ahead of Industrial production data for April is scheduled to be released on Friday. Investors were getting some encouragement with the India Meteorological Department’s report that Southwest monsoon has hit Kerala and seeing heavy rains for last few hours, covering most parts of Kerala and Tamil Nadu and some parts of south interior Karnataka. It also said that coast of Maharashrtra may see rains in next 4 days. Further, some support also came in with the government pitching for a ratings upgrade with global agency Fitch Ratings citing improvement in macroeconomic conditions and its commitment to fiscal consolidation. Fitch Ratings had in December affirmed India's 'BBB-' rating with a stable outlook. Meanwhile, the Commerce Minister Nirmala Sitharaman said that foreign direct investment (FDI) went up 42% since the NDA government assumed office in May 2014. However, gain remained capped with the World Bank in its Global Economic Prospects cutting India’s growth projections to 7.6-7.7 per cent for 2016-17 and 2017-18 from 7.9 per cent pegged earlier in January. Further, the World Bank has also lowered its forecast for the global growth in 2016 to 2.4%, saying that the world economy is facing stronger headwinds.

On the global front, Asian markets ended mixed, as weak Chinese export data offset a brightening energy sector outlook and an expected delay in interest rate hikes by the US Federal Reserve. Data showed that China's exports fell more than expected in May as global demand remained stubbornly weak, but imports beat forecasts, adding to hopes that the economy may be stabilize. European markets were trading lower, as a drop in Austrian bank Erste knocked back financial stocks.

Back home, after making a positive opening, Indian equity benchmark was alternating between positive and negative territory throughout the session and finally ended with gain of over 6 points. The top gainers from the F&O segment were JSW Energy, Mcleod Russel India and TV18 Broadcast. On the other hand, the top losers were Kotak Mahindra Bank, Infosys and Zee Entertainment Enterprises. In the index options segment, maximum OI was being seen in the 8000-8600 calls and 7000-8300 puts. In today's session, while the traders preferred to exit 7800 put, heavy buildup was seen in the 8100 put. On the other hand, traders exited from 8700 Call, while 8300 call witnessed considerable OI addition.    

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increased by 1.83% and reached 15.14. The 50-share Nifty was up by 6.60 points or 0.08% to settle at 8,273.05.   

Nifty June 2016 futures closed at 8284.20 on Wednesday at a premium of 11.15 points over spot closing of 8,273.05, while Nifty July 2016 futures ended at 8308.95 at a premium of 35.90 points over spot closing.  Nifty June futures saw contraction of 0.15 million (mn) units, taking the total outstanding open interest (OI) to 21.49 million (mn) units. The near month derivatives contract will expire on June 30, 2016.                              

From the most active contracts, State Bank of India June 2016 futures futures were trading flat compared with spot closing of 209.90. The number of contracts traded were 37,145.                 

ICICI Bank June 2016 futures traded at a discount of 4.20 points at 253.05 compared with spot closing of 257.25. The number of contracts traded were 22,781.            

Bank of Baroda June 2016 futures traded at a premium of 0.85 points at 148.60 compared with spot closing of 147.75. The number of contracts traded were 9,700.  

Punjab National Bank June 2016 futures traded at a premium of 0.65 points at 81.25 compared with spot closing of 80.60. The number of contracts traded were 8,767.                

Tata Motors June 2016 futures traded at a premium of 3.95 points at 468.95 compared with spot closing of 465.00. The number of contracts traded were 10,608.  

Among Nifty calls, 8300 SP from the June month expiry was the most active call with an addition of 0.08 million open interests. Among Nifty puts, 8200 SP from the June month expiry was the most active put with an addition of 0.25 million open interests. The maximum OI outstanding for Calls was at 8300 SP (4.98 mn) and that for Puts was at 8000 SP (6.73 mn). The respective Support and Resistance levels of Nifty are: Resistance 8290.62 --- Pivot Point 8271.33 --- Support --- 8253.77.             

The Nifty Put Call Ratio (PCR) finally stood at 1.30 for June month contract. The top five scrips with highest PCR on OI were Maruti Suzuki India (1.34), Apollo Hospital (1.31), Indusind Bank (1.18), Yes Bank (1.07) and Asian Paints (1.06).    

Among most active underlying, State Bank of India witnessed a contraction of 0.77 million of Open Interest in the June month futures contract, followed ICICI Bank witnessing a contraction of 2.52 million of Open Interest in the June month contract; Yes Bank  witnessed a contraction of 0.50 million of Open Interest in the June month contract, Tata Motors witnessed an addition of 0.05 million of Open Interest in the June month contract and Tata Steel witnessed a contraction of 1.22 million units of Open Interest in the June month's future contract.