Nifty settles near 8,950 level on firm global cues

Buoyed by firm global cues, the Indian benchmark index -- Nifty-- traded jubilantly on Tuesday and finished the session with a gain of over one and half percent. Sentiment also remained up-beat on expectation of further delay in interest rate hike by the US Federal Reserve on account of slower than expected US jobs data in August. Some support also came with reports that growth in India’s services industry accelerating to its fastest pace in more than 3-1/2 years in August, driven by a surge in domestic and foreign demand. The Nikkei/Markit Services Purchasing Managers’ Index jumped to 54.7 in August, it’s highest since January 2013, from 51.9 in July. After a gap up opening, market traded in tight-band for most part of the day’s trade near its crucial 8,900 levels. Market extended its gains in last leg of trade to end near 18 month high level, as traders took some encouragement with the reports that Prime Minister’s Office (PMO) will soon clear projects worth Rs 20 lakh crore, stating that the Project Monitoring Group (PMG) has already cleared 276 projects worth 10 lakh crore which were stalled due to various reasons including roads, environment, coal and power among others. Positive opening in European counterparts too provided strength to domestic market. European stocks were mostly higher, as a rebound in oil prices boosted energy-related stocks and as markets continued to digest Friday’s disappointing US jobs data, while Asian shares gained as prospects for a US interest-rate increase this month remained subdued.

Back home, hectic buying activity was witnessed in banking, consumer durables, auto counter. In scrip specific developments, Tata Motors surged after the company bagged orders worth Rs 900 crore for over 5,000 buses from various state and city transport undertakings in the first five months of the financial year. Maruti Suzuki gained after the company announced that its total production rose 3.25% to 1.27 lakh units in August 2016 over August 2015.

The top gainers from the F&O segment were Tata Motors, Axis Bank and Tata Motors-DVR. On the other hand, the top losers were Jubilant Foodworks, MindTree and Tata Elxsi. In the index options segment, maximum OI was being seen in the 8900-9100 calls and 8600-9000 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility contraction by 1.47% and reached 12.75. The 50-share Nifty was up by 133.35 points or 1.51% to settle at 8,943.00

Nifty September 2016 futures closed at 8961.20 on Tuesday at a premium of 18.20 points over spot closing of 8,943.00, while Nifty October 2016 futures ended at 9001.25 at a premium of 58.25 points over spot closing. Nifty September futures saw addition of 0.72 million (mn) units, taking the total outstanding open interest (OI) to 33.89 million (mn) units. The near month derivatives contract will expire on September 29, 2016.

From the most active contracts, State Bank of India September 2016 futures traded at a discount of 0.25 points at 260.85 compared with spot closing of 261.10. The numbers of contracts traded were 15,603.

ICICI Bank September 2016 futures traded at a premium of 1.05 points at 273.25 compared with spot closing of 272.20. The numbers of contracts traded were 19,314.

Axis Bank September 2016 futures traded at a premium of 2.70 points at 638.60 compared with spot closing of 635.90. The numbers of contracts traded were 23,696.

Tata Motors September 2016 futures traded at a premium of 2.35 points at 589.90 compared with spot closing of 587.55. The numbers of contracts traded were 26,424.   

Reliance Industries September 2016 futures traded at a premium of 2.50 points at 1024.60 compared with spot closing of 1,022.10. The numbers of contracts traded were 12,988.   

Among Nifty calls, 9000 SP from the September month expiry was the most active call with a contraction of 0.14 million open interests. Among Nifty puts, 8800 SP from the September month expiry was the most active put with an addition of 1.22 million open interests. The maximum OI outstanding for Calls was at 9000 SP (8.88 mn) and that for Puts was at 8600 SP (6.31 mn). The respective Support and Resistance levels of Nifty are: Resistance 8979.75--- Pivot Point 8914.10--- Support --- 8877.35.             

The Nifty Put Call Ratio (PCR) finally stood at 1.35 for September month contract. The top five scrips with highest PCR on OI were MRF (8.00), TATAMOTORS (1.53), YESBANK  (1.52), MARUTI (1.46) and AXISBANK (1.22).   

Among most active underlying Tata Motors witnessed an contraction of 0.57 million of Open Interest in the September month futures contract, followed Axis Bank witnessing an contraction of 1.77 million of Open Interest in the September month contract, Yes Bank witnessed a addition  of 0.05 million of Open Interest in the September month contract, ICICI Bank witnessed an contraction  of 3.65 million of Open Interest in the September month contract and State Bank of India witnessed an contraction  of 0.29 million units of Open Interest in the September month's future contract.