Nifty extends losses for sixth consecutive session; closes below 8100 mark

The local benchmark, Nifty extended its losing streak for sixth successive session and snapped the day’s trade below its crucial 8,100 mark as concerns about near term outlook of the economy continued to weigh on sentiments. Confirming fears of demonetisation move hitting growth, Global financial services major Nomura said its proprietary indices have dipped to the lowest levels since 1996, with rural consumption showing the maximum impact. However, downside remained capped with Finance Minister Arun Jaitley’s statement that the government would offer tax incentives to small businesses engaged in cashless transactions, as part of the government's fight against the cash economy. He said the move would enable businesses with annual turnover of Rs 2 crore to save up to 30 per cent in tax payments.

Traders were seen piling up positions in Realty, Metal and PSU Bank stocks, while selling was witnessed in FMCG, Media and IT sector stocks. The top gainers from the F&O segment were PC Jeweller, Reliance Communications and DLF. On the other hand, the top losers were Ceat, Petronet LNG and Bharti Infratel. In the index option segment, maximum OI continues to be seen in the 8100-8500 calls and 7800-8200 puts indicating this is the trading range expectation.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 1.15% and reached 14.70. The 50-share Nifty was down by 21.10 points or 0.26% to settle at 8,061.30.

Nifty December 2016 futures closed at 8080.65 on Wednesday at a premium of 19.35 points over spot closing of 8,061.30, while Nifty January 2017 futures ended at 8115.20 at a premium of 53.90 points over spot closing. Nifty December futures saw a contraction of 0.13 million (mn) units, taking the total outstanding open interest (OI) to 14.27 million (mn) units. The near month derivatives contract will expire on December 29, 2016.

From the most active contracts, Bharat Financial Inclusion December 2016 futures traded at a premium of 2.1 points at 579.75 compared with spot closing of 577.65. The numbers of contracts traded were 13,901.

Sun Pharmaceuticals Industries December 2016 futures traded at a premium of 2.35 points at 616.65 compared with spot closing of 614.30. The numbers of contracts traded were 10,092.

Reliance Communications December 2016 futures traded at a premium of 0.25 points at 37.50 compared with spot closing of 37.25. The numbers of contracts traded were 9,884.

State Bank of India Industries December 2016 futures traded at a premium of 1.35 points at 255.95 compared with spot closing of 254.60. The numbers of contracts traded were 9,684.

Yes Bank December 2016 futures traded at a premium of 3.75 points at 1141.95 compared with spot closing of 1138.20. The numbers of contracts traded were 8,240.

Among Nifty calls, 8100 SP from the December month expiry was the most active call with an addition of 0.45 million open interests. Among Nifty puts, 8100 SP from the December month expiry was the most active put with a contraction of 0.16 million open interests. The maximum OI outstanding for Calls was at 8300 SP (5.70 mn) and that for Puts was at 8000 SP (6.70 mn). The respective Support and Resistance levels of Nifty are: Resistance 8098.15--- Pivot Point 8075.70--- Support --- 8038.85.             

The Nifty Put Call Ratio (PCR) finally stood at 1.02 for December month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (17.50), DCB Bank (3.18), Colgate-Palmolive (2.47), Marico (1.74) and Indo Count Industries (1.23).    

Among most active underlying, Vedanta witnessed a contraction of 0.64 million of Open Interest in the December month futures contract, followed by State Bank of India witnessing a contraction of 1.21 million of Open Interest in the December month contract, Yes Bank witnessed a contraction of 0.19 million of Open Interest in the December month contract, Bharat Financial Inclusion witnessed a contraction of 0.13 million of Open Interest in the December month contract and Maruti Suzuki India witnessed an addition of 0.01 million units of Open Interest in the November month's future contract.