Nifty wipes out early gains to end lower; holds 8500 mark

The Indian benchmark -- Nifty wiped out all its early gains in last hour of trade to end marginally lower on account of profit booking at higher level. After getting a gap-up start market traded in narrow band with a gain of over half a percent as sentiments remained optimistic on report that India’s exports in June rose 1.27 per cent to $22.57 billion, snapping 18-month downward spiral to supported the market. Some support also came with Reliance Industries reporting better-than-expected Q1 numbers. The company reported 18 per cent jump in June quarter net profit. Consolidated net profit at Rs 7,113 crore was 18.1 per cent higher than Rs 6,024 crore in the same period last fiscal. However, market turned entered into negative terrain in last leg of trade as traders opted to book profit at higher level keeping a close watch on the monsoon session of Parliament which started today amid hopes the government will be able to pass the Goods and Services Tax Bill that is now stuck in the Upper House. Some cautiousness crept in with the industry body Assocham’s statement that government and the main opposition party should get the long-stalled Constitutional Amendment Bill on GST passed in the Rajya Sabha in first few days of the monsoon session of Parliament.

On global front, Asian markets ended mostly in green following a failed coup attempt in Turkey as energy and financial companies advanced. European markets, after a positive start, were exhibiting mixed trend. Back home, selling pressure in heavyweights like HDFC, Bharti Airtel, Reliance Industries, HUL and ICICI Bank too dampened sentiments. Telecom stocks too ended lower after Idea Cellular and Bharti Airtel slashed mobile internet rates to offer more value to customers. Finally nifty settled with a cut of over one third of a percent and a loss of 32.70 points.

The top gainers from the F&O segment were CESC, CEAT and Bajaj Auto. On the other hand, the top losers were Idea Cellular, Oil & Natural Gas Corporation and Jindal Steel & Power. In the index options segment, maximum OI was being seen in the 8400-8900 calls and 8000-8600 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility increase by 0.24% and reached 15.98. The 50-share Nifty was up by 32.70 points or 0.38% to settle at 8,508.70.

Nifty July 2016 futures closed at 8520.50 on Monday   at a premium of 11.80 points over spot closing of 8,508.70, while Nifty August 2016 futures ended at 8556.85 at a premium of 48.15 points over spot closing. Nifty July futures saw contraction of 0.13 million (mn) units, taking the total outstanding open interest (OI) to 22.37 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 0.10 points at 228.70 compared with spot closing of 228.60. The number of contracts traded were 14,295.   

ICICI Bank of July 2016 futures traded at a premium of 1.00 points at 264.00 compared with spot closing of 263.00. The number of contracts traded were 13,064.    

Punjab National Bank July 2016 futures traded at a discount of 0.10 points at 132.00 compared with spot closing of 132.10. The number of contracts traded were 10,052.             

Tata Motors July 2016 futures traded at a premium of 2.10 points at 492.85 compared with spot closing of 490.75. The number of contracts traded were 11,742.   

Tata Steel July 2016 futures traded at a discount of 5.80 points at 358.75 compared with spot closing of 364.55. The number of contracts traded were 16,162. 

Among Nifty calls, 8600 SP from the July month expiry was the most active call with an addition of 0.77  million open interests. Among Nifty puts, 8500 SP from the July month expiry was the most active put with an addition of 0.10 million open interests. The maximum OI outstanding for Calls was at 8700 SP (5.12 mn) and that for Puts was at 8400 SP (5.60 mn). The respective Support and Resistance levels of Nifty are: Resistance 8565.75--- Pivot Point 8530.05--- Support --- 8473.00.             

The Nifty Put Call Ratio (PCR) finally stood at 1.11 for July month contract. The top five scrips with highest PCR on OI were HDFC (1.37), GRASIM (1.37), MARUTI (1.35), HEROMOTOCO (1.24) and CANBK (1.14).   

Among most active underlying Reliance Industries  witnessed an contraction of 0.88 million of Open Interest in the July month futures contract, followed Infosys witnessing an contraction of 0.46 million of Open Interest in the July month contract; Hindustan Unilever witnessed a addition of 0.17 million of Open Interest in the July month contract, Tata Steel witnessed an contraction of 0.15 million of Open Interest in the July month contract and State Bank of India witnessed an addition of 0.57 million units of Open Interest in the July month's future contract.