Nifty snaps May F&O series with a massive cut of over 5%

The domestic index S&P CNX Nifty finished the May F&O series with a massive cut of about 265 points or 5.10% on the back of weak global cues while weakening in rupee too dampened the investors’ sentiments. Today Nifty extended its previous session’s losses and snapped the day’s trade in the red with a cut of over half percent breaching its crucial 4,950 mark. On the global front, Asian stocks fell over fear that fresh worries in Spain and Italy may worsen conditions in Europe. In addition, rising global uncertainty saw investors’ dumping risky assets. Back home, steep fall in Indian rupee and disappointing Q4 GDP numbers also worsened the market sentiments.

Triggered by weak Asian markets, Indian equities kick-started trade on a subdued note moreover, rising global uncertainty saw investors offloading risky assets. Steep fall in Indian rupee also worsened market sentiments and market breached its crucial 4,900 mark. The local currency today continued to decline for the fourth consecutive session on back of concerns prevailing over euro-zone and dropped to a record low of Rs 56.50 in morning trade. Afterwards selling got intensified and the index touched its intraday low near its 4,880 level on the back of disappointing Q4 GDP numbers. India’s economy grew at an annual rate of 5.3% in the quarter ended March 2012, much lower than expected. GDP growth for the full year was 6.5% against 8.4% last year, reporting the slowest pace in three years. But, market absorbed Q4 GDP shocker and started paring its earlier losses in the second half following positive opening on European counters. Market regained some momentum and reclaimed its crucial 4,900 mark as short-covering coupled with value buying witnessed in the dying hours of trade. Moreover, recovery in rupee in late trade too aided the sentiments but, Nifty failed to cross the equator and snapped the day’s trade with a cut of half a percent.

Meanwhile, most of the sectoral indices on the NSE were settled in the red, CNX Auto remained the major loser, down 1.95% followed by bank Nifty down 0.98% and CNX Metal down 0.28% while CNX Media and CNX Realty surged 1.42% and 0.82% in the trade, respectively. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, dipped 0.19% and reached 25.25.

The India VIX witnessed contraction of 0.20% at 25.25 as compared to its previous close of at 25.30 on Wednesday.

The 50-share S&P CNX Nifty lost 26.50 by point or 0.54% to settle at 4924.25.

Nifty June 2012 futures closed at 4,921.60 at a discount of 2.65 points over spot closing of 4,924.25, while Nifty July 2012 futures were at 4,937.30 at a premium of 13.05 points over spot closing. The near month June 2012 derivatives contract will expire on Thursday i.e. June 28, 2012. Nifty June futures saw an addition of 2.63 million (mn) units taking the total outstanding open interest (OI) to 14.35 mn units.

From the most active contract, Tata Steel June 2012 futures were at a discount of 10.65 point at 397.05 compared with spot closing of 407.70. The number of contracts traded was 14,217.

ICICI Bank June 2012 futures were at a premium of 3.50 points at 788.90 compared with spot closing of 785.40. The number of contracts traded was 17,959.

Reliance Industries June 2012 futures were at a discount of 7.25 point at 710.75 compared with spot closing of 718.00. The number of contracts traded was 21,940. 

SBI June 2012 futures were at a discount of 6.45 point at 2,059.45 compared with spot closing of 2,065.90. The number of contracts traded was 27,942.

Among Nifty calls, 5000 SP from the May month expiry was the most active call with an addition of 1.64 million open interest.

Among Nifty puts, 4800 SP from the May month expiry was the most active put with an addition of 2.41 million open interest.

The maximum OI outstanding for Calls was at 5000 SP (7.93 mn) and that for Puts was at 4800 SP (10.23mn).

The respective Support and Resistance levels are: Resistance 4954.48-- Pivot Point 4919.01--Support 4888.78.

The Nifty Put Call Ratio (PCR) OI wise stood at 0.95 for May-month contract.

The top five scrips with highest PCR on OI were ABG Ship 47.00, WelCorp 7.57, MRPL 3.13, Asian Paints 2.28 and PirHealth 2.00

Among the most active underlying, Suzlon witnessed an addition of 32.28 million of Open Interest in the April month futures contract followed by IFCI which witnessed a contraction of 12.60 million of Open Interest in the near month contract. Meanwhile, LITL witnessed an addition of 24.94 million in the April month futures. Also, RCOM witnessed contraction of 8.53 million in Open Interest in the April month contract. Finally, Jaiprakash Associates witnessed contraction of 10.38 million of Open Interest in the near month futures contract.