Nifty wipes out early gains to end lower; holds 8600 mark

Erasing all their early gains, the Indian benchmark -- Nifty -- ended the session marginally in red. It was profit booking in last leg of trade which dragged benchmark lower. Earlier, market made firm start, as sentiment remained up-beat with India’s core sector expanding at its fastest rate in last two months which showed a growth of 5.2 percent in June, compared with a 2.8 percent rise in May and 3.1 percent in the year ago period, riding on double digit growth in the cement, coal sector and a huge jump in output of electricity. Some support also came with the report India’s weather office IMD keeping its above-average forecast for June to September. Hopes that the Parliament would pass the Goods and Services Tax (GST) Bill as early as this week too supported sentiment. However, market turned flat and entered into negative terrain in last leg of trade as investors opted to book their profits at higher levels.

Weakness in European shares too dampened sentiment. European counterparts are trading with a cut of around a percent at this point of time, to hit two-week low, mirroring a weak trend in Asia and falling crude prices. Asian markets ended mostly lower on Tuesday with recent yen strength, the continued downturn in oil prices and lackluster US data weighing on markets.

The top gainers from the F&O segment were IDFC, Tata Communications and Marico. On the other hand, the top losers were Bharat Financial Inclusion, Jindal Steel & Power and Vedanta. In the index options segment, maximum OI was being seen in the 8500-9000 calls and 8000-8700 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility addition by 3.38% and reached 15.62. The 50-share Nifty was down by 13.65 points or 0.16% to settle at 8,622.90

Nifty August 2016 futures closed at 8660.30 on Tuesday at a premium of 37.40 points over spot closing of 8,622.90, while Nifty September 2016 futures ended at 8709.35 at a premium of 86.45 points over spot closing. Nifty August futures saw addition of 0.28 million (mn) units, taking the total outstanding open interest (OI) to 22.81 million (mn) units. The near month derivatives contract will expire on August 25, 2016.

From the most active contracts, State Bank of India August 2016 futures traded at a premium of 0.65 points at 228.65 compared with spot closing of 228.00. The number of contracts traded were 13,109.

ICICI Bank August 2016 futures traded at a premium of 1.20 points at 246.80 compared with spot closing of 245.60. The number of contracts traded were 15,781.   

Bank of Baroda of August 2016 futures traded at a premium of 0.85 points at 152.05 compared with spot closing of 151.20. The number of contracts traded were 9,782.

Tata Steel August 2016 futures traded at a premium of 0.40 points at 363.60 compared with spot closing of 363.20. The number of contracts traded were 14,487.   

HCL Technologies August 2016 futures traded at a premium of 2.80 points at 801.80 compared with spot closing of 799.00. The number of contracts traded were 10,683. 

Among Nifty calls, 8800 SP from the August month expiry was the most active call with an addition of 0.67 million open interests. Among Nifty puts, 8600 SP from the August month expiry was the most active put with an addition of 0.22 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.97 mn) and that for Puts was at 8500 SP (4.34 mn). The respective Support and Resistance levels of Nifty are: Resistance 8669.60--- Pivot Point 8640.50--- Support --- 8593.80.             

The Nifty Put Call Ratio (PCR) finally stood at 0.81 for August month contract. The top five scrips with highest PCR on OI were EICHERMOT (2.00), SRF (1.58), JINDALSTEL (1.18), BAJFINANCE (1.17) and MARUTI (1.17).   

Among most active underlying Maruti Suzuki India witnessed an addition of 0.01 million of Open Interest in the August month futures contract, followed Bharat Financial Inclusion witnessing an addition of 1.18 million of Open Interest in the August month contract; ICICI Bank witnessed a addition of 5.05 million of Open Interest in the August month contract, Tata Steel witnessed an contraction of 0.44 million of Open Interest in the August month contract and Voltas witnessed an contraction of 0.02 million units of Open Interest in the August month's future contract.