Nifty ends below 8550 mark ahead of next week’s US presidential election

Wednesday’s session turned out to be a daunting session of trade for Nifty which ended with a cut of around one and a half percent ahead of next week’s US presidential election amid weak global cues. After a gap down opening, market traded in tight band and never looked confident during the session to end near intraday lows, as sentiment remained downbeat after Standard & Poor's Global Ratings ruled out upgrading India's rating in the next two years, citing wide fiscal deficit, a heavy debt burden and low per capita income. Sentiments also weighed down with the private report stating that India has exported goods and services worth over Rs 17 trillion over the last 44 years but have not remitted an equal amount in foreign exchange. Weakness in Indian rupee too dampened sentiment. Beside, traders remained cautious ahead of the outcome of Federal Open Market Committee (FOMC)'s two-day meet on monetary policy which will conclude today.

Weak opening in European counter further dampened sentiments, European stocks were trading lower, as uncertainty over the outcome of the upcoming US presidential election continued to weigh on market sentiment. Asian stocks ended in red on Wednesday, as the U.S. presidential race appeared to tighten and investors awaited the Fed policy statement for clues on the timing of the next U.S. rate hike.

The top gainers from the F&O segment were M&M, Bharti Infratel and Torrent Power. On the other hand, the top losers were Oriental Bank of Commerce, Canara Bank and NCC. In the index options segment, maximum OI was being seen in the 8500-9000 calls and 8500-8600 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility addition by 6.75% and reached 16.79. The 50-share Nifty was down by 112.25 points or 1.30% to settle at 8,514.00

Nifty November 2016 futures closed at 8542.60 on Wednesday at a premium of 28.60 points over spot closing of 8,514.00, while Nifty December 2016 futures ended at 8594.65 at a premium of 80.65 points over spot closing. Nifty November futures saw contraction of 0.15 million (mn) units, taking the total outstanding open interest (OI) to 17.21 million (mn) units. The near month derivatives contract will expire on November 24, 2016.

From the most active contracts, SBI November 2016 futures traded at a premium of 0.50 points at 251.50 compared with spot closing of 251.00. The numbers of contracts traded were 12,720.

Vedanta November 2016 futures traded at a discount of 1.75 points at 217.15 compared with spot closing of 218.90. The numbers of contracts traded were 13,302.

ICICI Bank November 2016 futures traded at a premium of 0.45 points at 273.35 compared with spot closing of 272.90. The numbers of contracts traded were 11,868.

Axis Bank India November 2016 futures traded at a premium of 2.10 points at 478.15 compared with spot closing of 476.05. The numbers of contracts traded were 15,328.   

Hindalco Industries November 2016 futures traded at a discount of 0.20 points at 156.75 compared with spot closing of 156.95. The numbers of contracts traded were 8,876.   

Among Nifty calls, 8700 SP from the November month expiry was the most active call with a addition of 0.23 million open interests. Among Nifty puts, 8500 SP from the November month expiry was the most active put with an contraction of 0.03 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.26 mn) and that for Puts was at 8600 SP (3.09 mn). The respective Support and Resistance levels of Nifty are: Resistance 8540.72--- Pivot Point 8522.78--- Support --- 8496.07.             

The Nifty Put Call Ratio (PCR) finally stood at 0.94 for November month contract. The top five scrips with highest PCR on OI were UBL (1.38), CUMMINSIND (1.17), PCJEWELLER (1.14), BATAINDIA  (1.10) and INDUSINDBK (1.09).   

Among most active underlying Vedanta witnessed an addition of 0.05 million of Open Interest in the November month futures contract, followed SBI witnessing an contraction of 1.31 million of Open Interest in the November month contract, Tata Steel witnessed a contraction of 1.13 million of Open Interest in the November month contract, Yes Bank witnessed an addition of 0.27 million of Open Interest in the November month contract and Axis Bank witnessed an contraction of 0.37 million units of Open Interest in the November month's future contract.