Nifty ends flat amid GDP downcast

The Indian equity benchmark -- Nifty -- ended a lackluster session on a flat note on Thursday as a slew of reports on GDP, core sector output and manufacturing stirred concerns about the state of the economy. GDP data showed that the country’s economy in the fourth quarter of the last financial year grew slowest in two years, at 6.1%, hurt by demonetisation. The slowdown in growth bumped India from the top spot in the list of the world’s fastest growing major economies.  Besides, India’s manufacturing sector growth slipped to a three-month low in May, due to softer expansions in new orders and production. The seasonally adjusted Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance- was down to 51.6 in May from 52.5 in April. The market also remained under pressure following weak Asian markets and subdued US stocks. Some concerns also came with the report stating that the core sector output declined to a three-month low of 2.5 percent in April, mainly due to lower coal, crude oil and cement production. However, investors shrugged off the report that Fiscal deficit in fiscal 2017 was 3.5% of GDP, in line with the budget projection, reflecting the government's commitment to the process of fiscal consolidation. In fiscal 2016, the deficit was 3.9% of GDP.

Traders were seen piling up positions in FMCG, Pharma and Media stocks, while selling was witnessed in Metal, Banking and Financial Services stocks. The top gainers from the F&O segment were Balkrishna Industries, CEAT and Apollo Tyres. On the other hand, the top losers were Ashok Leyland, Indian Oil Corporation and Vedanta.  In the index option segment, maximum OI continues to be seen in the 9400-10000 calls and 9000-9600 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 3.86% and reached 11.30. The 50-share Nifty was down by 5.15 points or 0.05% to settle at 9,616.10.

Nifty June 2017 futures closed at 9630.10 on Thursday at a premium of 14 points over spot closing of 9616.10, while Nifty July 2017 futures ended at 9648.10, at a premium of 32 points over spot closing. Nifty June futures saw an addition of 0.32 million (mn) units, taking the total outstanding open interest (OI) to 22.19 million (mn) units. The near month derivatives contract will expire on June 29, 2017.

From the most active contracts, Sun Pharmaceutical Industries June 2017 futures traded at a premium of 3.30 points at 510.80 compared with spot closing of 507.50. The numbers of contracts traded were 22,895.

Aurobindo Pharma June 2017 futures traded at a premium of 2.80 points at 581.50 compared with spot closing of 578.70. The numbers of contracts traded were 15,929.

Yes Bank June 2017 futures traded at a premium of 8.85 points at 1452.95 compared with spot closing of 1444.10. The numbers of contracts traded were 11,779.

ICICI Bank June 2017 futures traded at a discount of 0.80 points at 319.10 compared with spot closing of 319.90. The numbers of contracts traded were 11,661.

State Bank of India June 2017 futures traded at a premium of 1.15 points at 289.00 compared with spot closing of 287.85. The numbers of contracts traded were 11,157.

Among Nifty calls, 9700 SP from the June month expiry was the most active call with an addition of 0.16 million open interests. Among Nifty puts, 9500 SP from the June month expiry was the most active put with an addition of 0.33 million open interests. The maximum OI outstanding for Calls was at 9700 SP (4.56 mn) and that for Puts was at 9400 SP (5.87 mn). The respective Support and Resistance levels of Nifty are: Resistance 9637.20--- Pivot Point 9613.55--- Support --- 9592.45.

The Nifty Put Call Ratio (PCR) finally stood at 1.16 for June month contract. The top five scrips with highest PCR on OI were Amara Raja Batteries (2.69), V-Guard Industries (2.50), Indraprastha Gas (1.44), Raymond (1.33) and Engineers India (1.13).

Among most active underlying, Maruti Suzuki India witnessed an addition of 0.04 million units of Open Interest in the June month futures contract, followed by Tata Steel witnessing an addition of 0.11 million units of Open Interest in the June  month contract, ICICI Bank witnessed a contraction of 2.66 million units of Open Interest in the June month contract, State Bank of India witnessed an addition of 1.76 million units of Open Interest in the June  month future contract and Rural Electrification Corporation witnessed a contraction of 0.02 million units of Open Interest in the June month future contract.