Nifty ends above 8,300 level amid positive global cues

Nifty ended with decent gain for the fifth straight session on Friday on account of good buying in frontline blue-chip stocks amid firm global cues. Sentiment got boost with the report that Indian manufacturing activity surged to a three-month high in June, driven by stronger demand. The Nikkei/Markit Manufacturing Purchasing Managers’ Index (PMI) rose to 51.7 in June from May’s 50.7, its sixth month above the 50 mark that separates growth from contraction after it fell below that level in December for the first time in more than two years. Some support also came with the World Bank’s statement that India is a bright spot. The World Bank president has said that he is pleased with the progress that's been made in six priority areas. He added that Prime Minister Modi and his entire Cabinet have set extremely difficult and important targets. However, gains remained capped up to certain extent with the report that Infrastructure sectors grew at five-month low rate of 2.8 per cent in May, slipping from a four-year high of 8.5 per cent in previous month, as oil and natural gas output contracted.

On global front, most of the Asian market ended higher, while European markets made a positive opening in the early deal on Friday. Back home, Indian equity markets made a gap up start on the first day of the July F&O series and continued to trade in positive territory, as appreciation in rupee value against the dollar added to the optimistic sentiments. Markets extended gain and continue their positive trade till the end of the session with a decent gain of 40.60 point for the day. The top gainers from the F&O segment were Mcleod Russel India, Indian Oil Corporation and Mahindra & Mahindra Financial Services. On the other hand, the top losers were KPIT Technologies, Unitech and Jaiprakash Associates. In the index options segment, maximum OI was being seen in the 8300-8700 calls and 8000-8400 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 3.39% and reached 15.73. The 50-share Nifty was up by 40.60 points or 0.49% to settle at 8,328.35.    

Nifty July 2016 futures closed at 8355.15 on Friday  at a premium of 26.80 points over spot closing of 8,328.35, while Nifty August 2016 futures ended at 8386.30 at a premium of 57.95 points over spot closing. Nifty July futures saw addition of 0.32 million (mn) units, taking the total outstanding open interest (OI) to 18.75 million (mn) units. The near month derivatives contract will expire on July 28, 2016.                                

From the most active contracts, State Bank of India July 2016 futures traded at a premium of 1.25 points at 220.45 compared with spot closing of 219.20. The number of contracts traded were 16,650.   

Axis Bank July 2016 futures traded at a discount of 2.5 points at 539.70 compared with spot closing of 542.20. The number of contracts traded were 11,066.                    

ITC July 2016 futures traded at a premium of 1.30 points at 254.15 compared with spot closing of 252.85. The number of contracts traded were 9,378.             

ICICI Bank July 2016 futures traded at a premium of 2.20 points at 242.05 compared with spot closing of 239.85. The number of contracts traded were 8,114.   

Tata Steel July 2016 futures traded at a discount of 6.20 points at 321.20 compared with spot closing of 327.40. The number of contracts traded were 8,007.   

Among Nifty calls, 8400 SP from the July month expiry was the most active call with a contraction of 0.15 million open interests. Among Nifty puts, 8300 SP from the July month expiry was the most active put with an addition of 0.91 million open interests. The maximum OI outstanding for Calls was at 8500 SP (4.31 mn) and that for Puts was at 8000 SP (4.21 mn). The respective Support and Resistance levels of Nifty are: Resistance 8353.85 --- Pivot Point 8331.25 --- Support --- 8305.75.             

The Nifty Put Call Ratio (PCR) finally stood at 1.04 for July month contract. The top five scrips with highest PCR on OI were Torrent Pharmaceuticals (1.75), Mindtree (1.36), Grasim Industries (1.32), Britannia Industries (1.24) and Apollo Hospitals Enterprise (1.08).   

Among most active underlying, State Bank of India witnessed an addition of 0.78 million of Open Interest in the June month futures contract, followed Larsen & Toubro witnessing a contraction of 0.11 million of Open Interest in the June month contract; Maruti Suzuki India witnessed an addition of 0.04 million of Open Interest in the June month contract, Yes Bank witnessed an addition of 0.55 million of Open Interest in the June month contract and Axis Bank witnessed a contraction of 0.45 million units of Open Interest in the June month's future contract.