Post continuous four days of gains, bears retaliated back on Friday in late trade as investors booked their profit ahead of Reliance Industries’ fourth quarter earnings. Moreover, global cues too remained sluggish as Asian markets exhibited choppy trade with Japan’s Nikkei index fell on Friday to post its third straight weekly loss after a Spanish bond auction failed to extinguish fears of a renewed euro zone debt crisis, but a weaker yen offered support. Though, European counters rebounded after a negative start. CAC, DAX and FTSE gaining about a percent each ahead of today’s meeting of G20 finance ministers to discuss boosting resources to help ease Europe’s debt crisis. Back home, profit-booking intensified across the board with the capital infra, realty, banking, metal and energy sectors leading the decline.
Indian equity market made a sluggish start on the back of profit booking amid weak global cues. Afterwards Nifty traded near its neutral line for most part of the day’s trade, lacking any significant upside triggers as investors kept themselves busy only in stock specific activities. The investors sentiments also remained dampened ahead of the earnings announcement by Reliance Industries, which plunged over a percent amid expectations that the company is likely to report quarterly figures that would disappoint the Street. Moreover, the Capital Goods and Power counters remained under pressure after heavyweight BHEL once again suffered severe pounding, falling about one and half a percent amid reports that an US investment bank downgraded BHEL to Underweight citing slack demand led India from an under-supplied to an over-supplied market for power equipment. Market continued its choppy trade in noon trade as well following negative opening in European counters. But, in the late trade market witnessed a steep fall of about 80 points breaching its crucial 5,250 mark on account of potential ‘freak trade’ in the Nifty April futures, which plunged over 300 points to hit a low of 5,000. Nifty futures dropped 1.5 percent, dragging down spot indexes, which several dealers attributed to a trading mistake. However, markets recovered from day’s lows after National Stock Exchange (NSE), in a statement, told that its surveillance department is examining the issue and it is too early to say whether it was a freak trade or not. Moreover, rebound in European counters too aided the sentiments. Finally, Nifty snapped the day’s trade below its crucial 5,300 mark with a cut of over 40 points.
Meanwhile, most of the sectoral indices on the NSE were settled in the red, CNX Realty remained the major loser, down 1.60% followed by CNX Infra down 1.47% and CNX Energy down by 1.35% while CNX FMCG and CNX Auto surged 0.16% and 0.02% respectively in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged 3.82% and reached 20.09.
The India VIX witnessed an addition of 3.82% at 20.09 as compared to its previous close of at 19.35 on Thursday.
The 50-share S&P CNX Nifty lost 41.55 points or 0.78% to settle at 5290.85.Nifty April 2012 futures closed at 5302.00 at a premium of 11.15 points over spot closing of 5290.85, while Nifty May 2012 futures were at 5,338.15 at a premium of 47.30 points over spot closing. The near month April 2012 derivatives contract will expire on Thursday i.e. April 26, 2012. Nifty April futures saw contraction of 1.01 million (mn) units taking the total outstanding open interest (OI) to 18.15 mn units.
From the most active contract, Tata Motors April 2012 futures were at a premium of 0.15 point at 316.15 compared with spot closing of 316.00. The number of contracts traded was 15,021.
HDIL April 2012 futures were at a premium of 0.15 point at 87.05 compared with spot closing of 86.90. The number of contracts traded was 13,777.
Tata Steel April 2012 futures were at a discount of 0.70 points at 469.85 compared with spot closing of 470.55. The number of contracts traded was 16,129.
Reliance Industries April 2012 futures were at a premium of 2.60 point at 733.60 compared with spot closing of 731.00. The number of contracts traded was 18,197.
ICICI Bank April 2012 futures were at a premium of 3.70 point at 862.80 compared with spot closing of 859.10. The number of contracts traded was 19,789.
Among Nifty calls, 5400 SP from the April month expiry was the most active call with contraction of 0.37 million open interest.
Among Nifty puts, 5200 SP from the April month expiry was the most active put with contraction of 0.47 million open interest.
The maximum OI outstanding for Calls was at 5400 SP (6.61mn) and that for Puts was at 5200 SP (7.36mn).
The respective Support and Resistance levels are: Resistance 5336.18-- Pivot Point 5290.81 -- Support 5245.48.
The Nifty Put Call Ratio (PCR) OI wise stood at 1.25 for April -month contract.
The top five scrips with highest PCR on OI were ABG Ship 3.53, Patni 2.07, Tata Chem 2.00, Abirlanuvo 2.00 and Jindal saw 2.00
Among most active underlying, IFCI witnessed contraction of 2.16 million of Open Interest in the April month futures contract followed by RCOM which witnessed contraction of 0.18 million of Open Interest in the near month contract. Meanwhile, JP Associates Infra witnessed an addition of 0.20 million in the April month futures. Also, Tata Motors witnessed contraction of 4.72 million in Open Interest in the April month contract. Finally, HDIL witnessed contraction of 1.68 million of Open Interest in the near month futures contract.
