Nifty ends flat with modest losses

Indian equity benchmark -- Nifty -- recovered from its initial losses but still closed the last trading session of the week on a flat note with marginal losses. The market sentiments remained cautious ahead of a speech by U.S. Federal Reserve Chair Janet Yellen and declaration of the Assembly Election results next week. Some concern also came with Chief Economic Advisor Arvind Subramanian’s statement that Economic and political systems in India have 'not developed maturity' for nuanced interventions and tend to take recourse to bans and restrictions. However, downside remained capped with a report that services industry returned to growth in February for the first time in four months, as demand slowly recovers after the government's cash crackdown late last year. The seasonally adjusted Nikkei Services Business Activity Index rose back above the 50.0 no-change mark in February, posting 50.3 from 48.7 in January. The seasonally adjusted Nikkei India Composite PMI Output Index too climbed to 50.7 from 49.4 in January to signal the first increase in private sector activity across India since last October.

Traders were seen piling up positions in Realty, Metal and Media stocks, while selling was witnessed only in PSU, Financial Services and FMCG stocks. The top gainers from the F&O segment were Bharti Infratel, Hindalco Industries and GMR Infrastructure. On the other hand, the top losers were Apollo Hospitals Enterprise, Jain Irrigation Systems and Torrent Pharmaceuticals. In the index option segment, maximum OI continues to be seen in the 8900-9500 calls and 8400-9000 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 0.07% and reached 13.35. The 50-share Nifty was down by 2.20 points or 0.02% to settle at 8897.55.

Nifty March 2017 futures closed at 8922.80 on Friday at a premium of 25.25 points over spot closing of 8897.55, while Nifty April 2017 futures ended at 8950.90, at a premium of 53.35 points over spot closing. Nifty March futures saw a contraction of 0.58 million (mn) units, taking the total outstanding open interest (OI) to 21.53 million (mn) units. The near month derivatives contract will expire on March 30, 2017.

From the most active contracts, Reliance Industries March 2017 futures traded at a premium of 5.30 points at 1263.90 compared with spot closing of 1258.60. The numbers of contracts traded were 39,413.

Hindalco Industries March 2017 futures traded at a premium of 0.10 points at 198.95 compared with spot closing of 198.85. The numbers of contracts traded were 25,040.

Bharat Financial Inclusion March 2017 futures traded at a discount of 1.55 points at 812.45 compared with spot closing of 814.00. The numbers of contracts traded were 15,634.

Biocon March 2017 futures traded at a premium of 2.95 points at 1077.95 compared with spot closing of 1075.00. The numbers of contracts traded were 13,802.

Bharat Petroleum Corporation March 2017 futures traded at a premium of 4.80 points at 636.40 compared with spot closing of 631.60. The numbers of contracts traded were 12,950.

Among Nifty calls, 9000 SP from the March month expiry was the most active call with an addition of 0.20 million open interests. Among Nifty puts, 8800 SP from the March  month expiry was the most active put with a contraction of 0.06 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.33 mn) and that for Puts was at 8800 SP (3.99 mn). The respective Support and Resistance levels of Nifty are: Resistance 8916.40--- Pivot Point 8888.25--- Support --- 8869.40.

The Nifty Put Call Ratio (PCR) finally stood at 0.92 for March month contract. The top five scrips with highest PCR on OI were Indo Count Industries (1.24), UPL (1.01), NIIT Technologies (1.00), Godrej Consumer Products (0.93) and Hexaware Technologies (0.93).

Among most active underlying, Reliance Industries witnessed a contraction of 0.64 million units of Open Interest in the March month futures contract, followed by Hindalco Industries witnessing a contraction of 2.53 million units  of Open Interest in the March  month contract, Vedanta witnessed an addition of 0.71 million units of Open Interest in the March month contract, Bharat Financial Inclusion witnessed a contraction of 0.24 million units of Open Interest in the March  month future contract and State Bank of India witnessed an addition of 1.30 million units of Open Interest in the March  month future contract.