Bears tightened their grip over the market and Nifty snapped the day’s trade with a fall of over 40 points breaching its crucial 5,300 level on the back of profit booking on concerns of slowdown in the global economy and weakness in Indian rupee. Moreover, worries over monsoon too dented the sentiments. On the global front, all the Asian markets ended the trade in the negative terrain after a weak US jobs report stoked concern that world’s biggest economy remains mired in weak growth. Moreover, European counters too were trading choppy as dismal global economic data hit miners and a top German retailer offered fresh proof of the euro zone crisis impact on corporates ahead of the earnings season. Back home, investors remained on the safer side and offloaded their positions ahead of quarterly earnings of IT biggies Infosys and TCS, and the index of industrial production (IIP) for May, which is scheduled to be released later this week.
Earlier, domestic market made a subdued start as investors remain worried about global economic growth after sluggish US jobs data and Japanese industrial machinery makers suffering losses on falling orders. However a slight amount of recovery witnessed in the trade as buying was seen in FMCG and IT pack. But, weakness in rupee continued to drag the index lower. Market touched its intraday low near its crucial 5,250 mark in the early noon trade following choppiness in European counters. Meanwhile, a shortfall in India’s monsoon rains has widened to nearly 50 percent of average, and a deficient monsoon could prolong the current impasse in economic reforms. The sentiments also remained dampen as power stocks fell for the second straight day on profit booking after recent strong gains. Bucking the trend, the state owned oil marketing companies edged higher after Planning Commission Deputy Chairman Montek Singh Ahluwalia said that fuel price adjustment has to be made ‘at some point of time’ to get investments back. Moreover, the sentiments also got some support as shares of tyre firms extended recent gains triggered by decline in prices of natural rubber. Thereafter, Nifty traded in a tight band till end but down by about a percentage point and snapped the day’s trade with a cut of over three fourth of a percent.
Meanwhile, all the sectoral indices on the NSE hammered badly and settled in the red, CNX Metal remained the major loser, losing 1.46% followed by CNX Infra down 1.42% and CNX Realty down by 1.14% in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged 3.77% and reached 18.72.
The India VIX witnessed an addition of 3.77% at 18.72 as compared to its previous close of at 18.04 on Friday.
The 50-share S&P CNX Nifty lost 41.80 points or 0.79% to settle at 5,275.15.
Nifty July 2012 futures closed at 5,279.40 at a premium of 4.25 points over spot closing of 5,275.15, while Nifty August 2012 futures were at 5307.80 at a premium of 32.65 points over spot closing. The near month July 2012 derivatives contract will expire on Thursday i.e. July 26, 2012. Nifty July futures saw contraction of 0.59 million (mn) units taking the total outstanding open interest (OI) to 22.81 mn units.
From the most active contract, Tata Motors July 2012 futures were at a discount of 2.75 point at 237.65 compared with spot closing of 240.40. The number of contracts traded was 14,386.
HDIL July 2012 futures were at a discount of 0.10 point at 85.85 compared with spot closing of 85.65. The number of contracts traded was 7,192.
DLF July 2012 futures were at a discount of 0.35 point at 213.30 compared with spot closing of 213.65. The number of contracts traded was 7,426.
ICICI Bank July 2012 futures were at a discount of 5.85 points at 924.15 compared with spot closing of 930.00. The number of contracts traded was 29,040.
Tata Steel July 2012 futures were at a discount of 11.15 point at 425.85 compared with spot closing of 437.00. The number of contracts traded was 7,583.
Among Nifty calls, 5400 SP from the July month expiry was the most active call with an addition of 0.73 million open interest.
Among Nifty puts, 5000 SP from the July month expiry was the most active put with contraction of 0.07 million open interest.
The maximum OI outstanding for Calls was at 5400 SP (7.47mn) and that for Puts was at 5000 SP (7.39mn).
The respective Support and Resistance levels are: Resistance 5344.35 -- Pivot Point 5316.6--Support 5299.55.
The Nifty Put Call Ratio (PCR) OI wise stood at 1.42 for July -month contract.
The top five scrips with highest PCR on OI were APIL 4.00, DIVISLAB 3.00, MRF 2.00, Sun Pharma 1.58, and Grasim 1.13.
Among the most active underlying, IFCI witnessed contraction of 1.47 million of Open Interest in the July month futures contract followed by LITL which witnessed contraction of 1.01 million of Open Interest in the near month contract. Meanwhile, RCOM witnessed contraction of 0.84 million in the July month futures. Also, HDIL witnessed an addition of 0.60 million in Open Interest in the July month contract. Finally, Tata Motors witnessed contraction of 3.02 million of Open Interest in the near month futures contract.
