Nifty ends on negative note; fails to hold 9600 mark

Indian equity benchmark -- Nifty -- ended the lackluster session on a negative note on Thursday, closing below the psychological level of 9,600. The caution prevailed over the market as the US Fed raised its key interest rate by 25 basis points and announced plans to start paring its bond holdings, and on an overnight slump in crude prices. The ongoing US political turmoil also had a rub-off effect on the sentiments. Traders remained pessimistic with the report stating that the likely increase in farm loan waivers will dampen sentiments of PSU banks and NBFCs. Furthermore, Moody’s Investors Services’ latest report indicating that Reserve Bank of India’s (RBI’s) move to reduce the amount of money that banks have to set aside (as security) on home loans is negative from the perspective of the ratings of lenders, also added some concerns. Foreign portfolio investors (FPIs) sold shares worth a net Rs 161.13 crore on June 14, 2017. Meanwhile, Indians working across the globe sent home $62.7 billion last year, making India the top remittance-receiving country surpassing China.

Traders were seen piling up positions in FMCG, Realty and Pharma stocks, while selling was witnessed in IT, PSU and Auto stocks. The top gainers from the F&O segment were Aurobindo Pharma, Indiabulls Real Estate and Jaiprakash Associates. On the other hand, the top losers were Hindustan Petroleum Corporation, Indian Oil Corporation and Punjab National Bank. In the index option segment, maximum OI continues to be seen in the 9400-10000 calls and 9000-9700 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 1.29% and reached 11.32. The 50-share Nifty was down by 40.10 points or 0.42% to settle at 9,578.05.

Nifty June 2017 futures closed at 9600.90 on Thursday at a premium of 22.85 points over spot closing of 9578.05, while Nifty July 2017 futures ended at 9620.55, at a premium of 42.50 points over spot closing. Nifty June futures saw an addition of 0.16 million (mn) units, taking the total outstanding open interest (OI) to 21.59 million (mn) units. The near month derivatives contract will expire on June 29, 2017.

From the most active contracts, Reliance Industries June 2017 futures traded at a premium of 8.75 points at 1386.10 compared with spot closing of 1377.35. The numbers of contracts traded were 31,850.

Aurobindo Pharma June 2017 futures traded at a premium of 0.20 points at 644.25 compared with spot closing of 644.05. The numbers of contracts traded were 26,080.

DLF June 2017 futures traded at a discount of 0.15 points at 192.75 compared with spot closing of 192.90. The numbers of contracts traded were 13,435.

Dewan Housing Finance Corporation June 2017 futures traded at a discount of 1.10 points at 463.60 compared with spot closing of 464.70. The numbers of contracts traded were 13,027.

Yes Bank June 2017 futures traded at a premium of 6.85 points at 1452.85 compared with spot closing of 1446.00. The numbers of contracts traded were 11,596.

Among Nifty calls, 9700 SP from the June month expiry was the most active call with an addition of 0.98 million open interests. Among Nifty puts, 9600 SP from the June month expiry was the most active put with a contraction of 0.51 million open interests. The maximum OI outstanding for Calls was at 9700 SP (6.93 mn) and that for Puts was at 9500 SP (7.27 mn). The respective Support and Resistance levels of Nifty are: Resistance 9612.70--- Pivot Point 9586.75--- Support --- 9552.10.

The Nifty Put Call Ratio (PCR) finally stood at 1.07 for June month contract. The top five scrips with highest PCR on OI were Amara Raja Batteries (2.42), Oriental Bank of Commerce (1.96), HDFC Bank (1.18), Cipla (1.12) and Indiabulls Real Estate (1.08).

Among most active underlying, Reliance Industries witnessed a contraction of 0.63 million units of Open Interest in the June month futures contract, followed by DLF witnessing an addition of 2.64 million units of Open Interest in the June  month contract, Aurobindo Pharma witnessed an addition of 0.53 million units of Open Interest in the June month contract, Maruti Suzuki India witnessed an addition of 0.02 million units of Open Interest in the June  month future contract and State Bank of India witnessed an addition of 1.10 million units of Open Interest in the June month future contract.