Nifty ends highly volatile day of trade in the green

Recovering from initial losses the local benchmark, Nifty snapped the dramatic day of trade in the green with a gain of about 0.25 percent on Thursday. Moreover, the index witnessed a highly volatile day of trade and ended the session a tad low from its crucial 5,600 level. Earlier, the Indian equity market witnessed a sharp fall in the early trade tracking weak Asian counterparts. Moreover, Tuesday’s serial bomb blasts in the country’s financial capital too weighed on the sentiments and the index touched its intraday low breaching its crucial 5,550 mark. But, benchmark found strong support at that level and started its north-bound journey as sort covering witnessed in some of the blue-chip stocks. Sentiment got a boost after monthly inflations numbers for June came lower-than-street expectation of 9.70% and market touched its green zone in the late morning trade. Inflation for the month stood at 9.44% compared to 9.06% in April and WPI primary articles index was at 2.8% on a month-on-month basis. The interest rate sensitive counters like real estate and banking overlooked the spike in inflation numbers and pulled the index beyond its psychological 5,600 levels. The local index continued its bull run till mid noon trade and touched its crucial 5,650 mark. But, resistance was seen at that level and market witnessed a sudden downfall on report that India’s key monsoon rains were 19% below normal in the week to July 13. India’s June-September monsoon rains are crucial to crop production in 60% of the country that does not have adequate irrigation. Meanwhile, the information technology counter once again closed in the negative territory ahead of bellwether TCS’s first quarterly earnings announcement whil, the Auto counter too remained under some pressure after two wheeler major Bajaj Auto got punished post its lower than expected Q1 earnings announcement. Finally, Nifty snapped the day’s trade near its crucial 5,600 level with a marginal gain of 14 points.

On the global front, the US markets made a recovery overnight taking cues from the Comments of Fed Chairman Ben Bernanke. However, Asian equity indices finished the day’s trade on a mixed note on Thursday. While, all the European markets were trading in red at this point of time after Moody’s Investors Service warned that US government bonds may lose the AAA credit rating that it has held since 1917. Back home, broad based buying supported most of the sectoral indices on the NSE to settle in the positive territory with CNX Realty surging the most and ending with a gain of 2.42% followed by Bank Nifty up 1.09%, CNX Infra up 0.41% while, CNX IT down by 1.29% in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged 2.30% and reached 19.97, while S&P Nifty moved higher by 14.35 points or 0.26% to close at 5,599.80.

The India VIX witnessed an addition of 2.30% at 19.97 on Thursday as compared to its previous close of 19.52 on Wednesday.  

The 50-share S&P CNX Nifty gain 14.35 points or 0.26% and settled at 5,599.80.

Nifty July 2011 futures closed at 5,585.10, at a discount of 14.70 point over spot closing of 5,599.80, while Nifty August 2011 futures were at 5,604.40 at a premium of 4.60 points over spot closing. The near month July 2011 derivatives contract expires on Thursday, 28 July, 2011. Nifty July futures saw an addition of 9.75% or 2.15 million (mn) units, taking the total outstanding open interest (OI) to 24.20 mn units. 

From the most active underlying, SBI’s July 2011 futures closed at a premium of 1.05 points at 2467.00 compared with spot closing of 2465.95. The number of contracts traded was 26,928. 

TCS July 2011 futures were at a premium of 4.20 point at 1123.40 compared with spot closing of 1119.20. The number of contracts traded was 23,631. 

Infosys July 2011 futures were at a premium of 3.05 at 2743.00 compared with spot closing of 2739.95. The number of contracts traded was 18,195. 

ICICI Bank July 2011 futures were at a premium of 1.50 at 1067.05 compared with spot closing of 1065.55. The number of contracts traded was 22,281. 

Tata Motors July 2011 futures were at a discount of 22.65 at 1043.25 compared with spot closing of 1065.90. The number of contracts traded was 18,623.     Among Nifty calls, 5600 SP from the July month expiry was the most active call with addition of 0.43 million or 7.13%.

 Among Nifty puts, 5600 SP from the July month expiry was the most active put with addition of 0.80 million or 14.89%.

The maximum Call OI outstanding for Calls was at 5600 SP (6.50 mn) and that for Puts was at 5500 SP (6.19 mn).

The respective Support and Resistance levels are: Resistance 5655.27-- Pivot Point 5598.48-- Support 5543.02.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.18 for July -month contract.

The top five scrips with highest PCR on OI were Sun Pharma 5.49, Voltas 2.00, PNB 2.00, Kotak Bank 1.29 and Sun TV 1.28.

Among most active underlying, TCS witnessed an addition of 20.97% of Open Interest (OI) in the July month futures contract followed by SBI witnessed an addition of 3.04% of Open Interest (OI) in the near month contract. Meanwhile Infosys witnessed an addition of 13.05% of OI in the July month futures.