Nifty negotiates a second green close; shut shop above the neutral line

After getting onto a muted yet positive start, the widely followed index of National Stock Exchange (NSE) -Nifty- managed to pocket in slender gains, to clock in a second consecutive session of gains. However, the index, after puffing up over a percent in the previous session, showcased signs of exertion, as all the morning gains almost withered away by the end of the trade following deferral of CCI’s verdict on alleged cartelization case of cement companies.  The reports, which highlighted the likelihood of India’s competition watchdog imposing a penalty, which is three times of the profit of these companies triggered massive profit booking in the dying hours of the trade.

However, sanguine global leads on expectation of Fed’s 'Twist' again, kept the markets hooked to some gains. Asian pacific shares ended jaunty as investors bet on the expectations that Fed extending its bond-buying programme dubbed as 'Operation Twist', would prompt the major central banks to launch a new round of monetary stimulus. Meanwhile, European shares trading cautious, slipped in choppy trade.

Closer home, the widely followed index, Nifty, after getting a muted start, breached the 5,100 level  to enter into the red zone in the mid-morning deals post global rating agency Fitch downgraded the outlook on India-based financial institutions’ from Stable to Negative. The index then dipped to intra-day low with the opening of European markets, although significant recovery came to the index post noon session nevertheless that was not enough to take the index higher above the stiff 5,150 level. Meanwhile, shares of power equipment makers including heavyweights like L&T and BHEL were seen in jubilant mood as the government appeared closer on imposing duties of around 21% on imported power equipment.

Most of the sectoral indices on the NSE were settled in the green, CNX Pharma remained the major gainer, up 1.23% followed by CNX Metal up by 1.09% and CNX Auto up by 1.02%. On the flip side, CNX IT down by 0.29%, CNX FMCG down by 0.23% and CNX Realty declined 0.12% remained the only losers in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, tumbled 0.40% to conclude at 21.03.

The India VIX witnessed contraction of 1.87% at 21.03 as compared to its previous close of at 21.43 on Tuesday.

The 50-share S&P CNX Nifty gain 16.70 by point or 0.33% to settle at 5,120.55

Nifty June 2012 futures closed at 5,122.45 at a premium of 1.90 points over spot closing of 5,120.55, while Nifty July 2012 futures were at 5,140.65 at a premium of 20.10 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 0.15 million (mn) units taking the total outstanding open interest (OI) to 16.54 mn units.

From the most active contract, Sterlite Industries June 2012 futures were at a discount of 0.60 point at 96.70 compared with spot closing of 97.30. The number of contracts traded was 10,937.

JP Associates June 2012 futures were at a premium of 0.35 point at 71.60 compared with spot closing of 71.25. The number of contracts traded was 11,071.

Tata Motors June 2012 futures were at a premium of 0.85 point at 246.25 compared with spot closing of 245.40. The number of contracts traded was 18,919.

Tata Steel June 2012 futures were at a premium of 0.40 point at 426.55 compared with spot closing of 426.15. The number of contracts traded was 15,330.

ICICI Bank June 2012 futures were at a premium of 1.65 point at 835.65 compared with spot closing of 834.00. The number of contracts traded was 16,081. 

Among Nifty calls, 5300 SP from the Jun month expiry was the most active call with an addition of 1.74 million open interest.

Among Nifty puts, 4800 SP from the Jun month expiry was the most active put with an addition of 0.32 million open interest.

The maximum OI outstanding for Calls was at 5300 SP (8.08mn) and that for Puts was at 4800 SP (9.04mn).

The respective Support and Resistance levels are: Resistance 5141.26-- Pivot Point 5120.98--Support 5100.26.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.62 for June-month contract.

The top five scrips with highest PCR on OI were ABG Ship 6.33, ABB 5.00, Orient Bank 3.00, Tata Chem 3.00 and ACC 2.25.

Among the most active underlying, IFCI witnessed contraction of 1.81 million of Open Interest in the June month futures contract followed by LITL which witnessed an addition of 2.34 million of Open Interest in the near month contract. Meanwhile, RCOM witnessed contraction of 0.93 million in the June month futures. Also, Jaiprakash Associates witnessed an addition of 2.24 million in Open Interest in the June month contract. Finally, Tata Motors witnessed contraction of 0.97 million of Open Interest in the near month futures contract.