Nifty surpasses 5,650 level led by telecom and retail stocks

The local benchmark, Nifty witnessed a good day of trade as the index witnessed decent gains in the mid afternoon trade on Monday led by buying in telecom and retail stocks, while about one percent rise in RIL too supported the sentiments. However, global cues remained sluggish as US markets made a mixed closing on Friday while, all the Asian counterparts finished the trade in the negative terrain. The market traded near its neutral line in first half, afterwards it picked up the speed and snapped the day’s trade with a gain of over 0.80 percentage point surpassing its crucial 5,650 mark. Earlier, the investors remained cautious ahead of the RBI’s quarterly monetary policy review, where it is widely being expected that the central bank will go for another rate hike of 25 basis points. In the mid morning trade, benchmark turned positive taking support from report that the committee of secretaries recommended 51 percent Foreign Direct Investment (FDI) in multi-brand retail on Friday. Stocks like Pantaloon Retail, Cantabil Retail, Brand House retail and Vishal Retail all surged in the range of 1.50-6.50 percent. Some cautiousness was there as it being the F&O July series expiry week. In the mid afternoon session, the local index started its northward journey as European counterparts witnessed some recovery after a gloomy start. Meanwhile, shares of leading mobile service providers jumped after top mobile firm Bharti Airtel raised call tariffs in some of its telecom zones, triggering expectations that other firms will follow suit in a market that has one of the world’s cheapest call rates. The domestic index picked up its speed in the mid noon trade and touched the crucial 5,700 level for a while supported by broad based buying witnessed in all counters of the NSE. But, Nifty came off from its intraday high as profit booking was witnessed in some of the blue-chip stocks in the last half an hour of trade and the index snapped the day’s trade with a gain of over 45 points firmly over its psychological 5,650 mark.

On the global front, the US markets made a mixed closing on Friday, as concerns of lawmakers agreeing to increase country’s debt limit kept looming large amid some weak earnings announcements while, All the Asian equity indices finished the day’s trade in the negative terrain on Monday after US political leaders failed to reach a deal to raise Washington’s debt limit that is crucial to avoid an impending default. Moreover, most of the European counterparts were trading in the negative terrain at this point of time. Back home, broad based buying supported most of the sectoral indices on the NSE to settle in the positive territory with CNX Infra surging the most and ending with a gain of about 2% followed by CNX Pharma up 1.14% and CNX Services up 0.90% while, CNX FMCG and CNX IT declined 0.64% and 0.06% respectively in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged 7.20% and reached 19.20, while S&P Nifty moved higher by 46.35 points or 0.84% to close at 5,680.30.

The India VIX witnessed an addition of 7.20% at 19.20 as compared to its previous close of 17.91 on Friday.

The 50-share S&P CNX Nifty surged by 46.35 points or 0.82% to settle at 5,680.30.

Nifty July 2011 futures closed at 5,687.70, at a premium of 7.40 point over spot closing of 5,680.30, while Nifty August 2011 futures were at 5,703.80 at a premium of 23.50 points over spot closing. The near month July 2011 derivatives contract expires on Thursday, 28 July, 2011. Nifty July futures saw an addition of 4.20% or 0.82 million (mn) units, taking the total outstanding open interest (OI) to 20.41 mn units.

From the most active contract by contract value, RIL July 2011 futures closed at a premium of 3.35 points at 884.95 compared with spot closing of 881.60. The number of contracts traded was 32,931.

Bharti Airtel July 2011 futures were at a premium of 0.55 point at 431.70 compared with spot closing of 431.15. The number of contracts traded was 14,561.

Suzlon July 2011 futures were at a discount of 0.15 at 54.60 compared with spot closing of 54.75. The number of contracts traded was 13,383.

SBI's July 2011 futures were at a discount of 5.65 at 2514.35 compared with spot closing of 2520.00. The number of contracts traded was 18,245.

RCOM's July 2011 futures were at a premium of 0.15 at 106.70 compared with spot closing of 106.55. The number of contracts traded was 27,190. 

 Among Nifty calls, 5700 SP from the July month expiry was the most active call with a decline of 0.80 million or 9.12%.

Among Nifty puts, 5600 SP from the July month expiry was the most active put with  an addition of 1.99 million or 22.48%.

The maximum Call OI outstanding for Calls was at 5600 SP (9.56 mn) and that for Puts was at 5500 SP (10.88 mn).

The respective Support and Resistance levels are: Resistance 5715 -- Pivot Point 5665.85 -- Support 5631.15.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.39 for July month contract.

The top five scrips with highest PCR on OI were MRF 2.75, Sun Pharmaceuticals Industries 2.37, Punjab National Bank 2.07, Asian Paints 2.00 and Axis Bank 1.87.

Among most active underlying, Reliance witnessed an addition of 3.37% of Open Interest (OI) in the July month futures contract followed by Reliance Communication witnessed an addition of 11.98% of Open Interest (OI) in the near month contract. Meanwhile SBI witnessed an addition of 2.26% of OI in the July month futures.