Nifty fails to close above 8200 mark

After trading in tight range, Indian equity benchmark Nifty ended the session on negative note with small losses. Sentiments soured after the all-crucial GST meet remained deadlocked over dual control, compensation and high-sea taxes. Sentiments also dampened with the report that India's services industry contracted for a second month in a row in December as orders shrank amid a severe cash shortage. The Nikkei/Markit Services Purchasing Managers' Index was little changed at 46.8 in December from November's 46.7 (a reading below 50 indicates contraction). A new business sub-index, an indicator of domestic and foreign demand, fell to a 39-month low of 46.0 in December from 46.7, even though firms cut prices of their goods despite input costs rising at a faster pace. However, losses remained capped with appreciation in rupee against dollar.

Traders were seen piling up positions in Realty, IT and FMCG sector stocks, while selling was witnessed in PSU, Financial Services and Bank sector stocks. The top gainers from the F&O segment were Jaiprakash Associates, Indiabulls Real Estate and DLF Company. On the other hand, the top losers were Cummins India, Indo Count Industries and Hindustan Zinc. In the index option segment, maximum OI continues to be seen in the 8000-8500 calls and 7500-8200 puts indicating this is the trading range expectation.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 0.42% and reached 15.89. The 50-share Nifty was down by 1.75 points or 0.02% to settle at 8,190.50.

Nifty January 2017 futures closed at 8204.05 on Wednesday at a premium of 13.55 points over spot closing of 8190.50, while Nifty February 2017 futures ended at 8229.70 at a premium of 39.20 points over spot closing. Nifty January futures saw an addition of 0.29 million (mn) units, taking the total outstanding open interest (OI) to 17.53 million (mn) units. The near month derivatives contract will expire on January 25, 2017.

From the most active contracts, Bharat Financial Inclusion January 2017 futures traded at a premium of 2.40 points at 630.35 compared with spot closing of 627.95. The numbers of contracts traded were 13,159.

DLF January 2017 futures traded at a premium of 0.25 points at 125.80 compared with spot closing 125.55. The numbers of contracts traded were 10,889.

State Bank of India January 2017 futures traded at a premium of 0.35 points at 243.55 compared with spot closing of 243.20. The numbers of contracts traded were 10,760.

Century Textiles & Industries January 2017 futures traded at a premium of 2.90 points at 828.90 compared with spot closing of 826.00. The numbers of contracts traded were 10,531.

ICICI Bank January 2017 futures traded at a premium of 0.85 points at 251.80 compared with spot closing of 250.95. The numbers of contracts traded were 9,951.

Among Nifty calls, 8200 SP from the January month expiry was the most active call with an addition of 0.28  million open interests. Among Nifty puts, 8100 SP from the january month expiry was the most active put with an addition of 0.37 million open interests. The maximum OI outstanding for Calls was at 8200 SP (4.13 mn) and that for Puts was at 8000 SP (6.12 mn). The respective Support and Resistance levels of Nifty are: Resistance 8212.37--- Pivot Point 8196.63--- Support --- 8174.77.

The Nifty Put Call Ratio (PCR) finally stood at 1.20 for January month contract. The top five scrips with highest PCR on OI were TVS Motor (1.85), Dabur India (1.63), Ajanta Pharma (1.54), DLF (1.51) and Maruti Suzuki India (1.44).

Among most active underlying, State Bank of India witnessed an addition of 1.79 million of Open Interest in the January month futures contract, followed by Tata Steel witnessing an addition of 0.03 million of Open Interest in the January month contract, Century Textiles & Industries witnessed an addition of 0.31  million of Open Interest in the January month contract, Maruti Suzuki India witnessed a contraction of 0.03  million units of Open Interest in the January month future contract and DLF witnessed a contraction of 0.03  million units of Open Interest in the January month future contract.