S&P CNX Nifty extended its losses for the fourth straight day on Monday, shrugging off better than expected June inflation numbers. The index ended the session tad below its crucial 5,200 mark with a cut of over half a percent, as market seemed worried about monsoon while, sluggishness in European counters too dampened the sentiments. On the global front, Asian stock markets ended mostly higher on Monday amid hopes of further stimulus measures from China after Premier Wen Jiabao warned Sunday that the recovery in the world’s second largest economy was not stable. In addition, strong gains in Australia due to mining stocks rally supporting the markets in good way.
Back home,market remained in the red after a positive opening ahead of June inflation till mid morning trade but, once the inflation number came out it recovered slightly and regained its green trajectory touching its intraday high. Offering little relief to Reserve Bank of India (RBI), the wholesale price index (WPI), India’s main inflation gauge, rose at surprisingly lower-than-expected 7.25 percent for the month of June, as compared to 7.55% (Provisional) for the previous month and 9.51 percent during the corresponding month of the previous year. The sentiments were also supported by sugar stocks which edged higher in the trade on the report that Food Ministry has proposed imposing 10 percent import duty on sugar as the country has surplus domestic production. However, the recovery after the inflation number proved short lived and the index re-entered into the red terrain following lethargy in European markets. The sentiments were also dampened after Met Department says monsoon may miss forecast in July and may be deficient in September. Meanwhile, the Indian rupee, which recovered to 54.78 a dollar in early trade, depreciated 12 paise to 55.26 against the US dollar towards closing hours of equity market. The main damaged came up in the lat leg of trade where selling intensified on the back of sell off in software and metal pack. Metal shares declined for the second day in a row after the data released on July 13, 2012 showed Chinese economy cooled to its weakest rate of growth in more than three years in Q2 June 2012. Finally, Nifty ended the day’s trade near its intraday low, tad below its crucial 5,200 mark, with a cut of over half a percent.
Meanwhile, most of the sectoral indices on the NSE were settled in the red, CNX IT remained the major loser, down 2.40% followed by CNX Metal down 2.18% and CNX Realty down 1.65% while CNX Pharma and CNX PSU Bank surged 1.24% and 0.41% respectively in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, rose 2.79% and reached 18.77.
The India VIX witnessed an addition of 2.79% at 18.77 as compared to its previous close of at 18.26 on Friday.
The 50-share S&P CNX Nifty lost 30.00 points or 0.57% to settle at 5,197.25.
Nifty July 2012 futures closed at 5,206.85 at a premium of 9.60 points over spot closing of 5,197.25, while Nifty August 2012 futures were at 5232.30 at a premium of 35.05 points over spot closing. The near month July 2012 derivatives contract will expire on Thursday i.e. July 26, 2012. Nifty July futures saw an addition of 0.19 million (mn) units taking the total outstanding open interest (OI) to 23.94 mn units.
From the most active contract, Tata Motors July 2012 futures were at a discount of 2.65 point at 226.15 compared with spot closing of 228.80. The number of contracts traded was 16,222.
JP Associates July 2012 futures were at a premium of 0.40 point at 77.65 compared with spot closing of 77.25. The number of contracts traded was 9,727.
Tata Steel July 2012 futures were at a premium of 2.30 point at 409.20 compared with spot closing of 406.90. The number of contracts traded was 10,532.
ICICI Bank July 2012 futures were at a premium of 5.15 points at 922.65 compared with spot closing of 917.50. The number of contracts traded was 13,867.
SBI July 2012 futures were at a discount of 24.60 point at 2,179.90 compared with spot closing of 2,204.50. The number of contracts traded was 27,062. Among Nifty calls, 5400 SP from the July month expiry was the most active call with an addition of 0.13 million open interest.
Among Nifty puts, 5000 SP from the July month expiry was the most active put with an addition of 0.20 million open interest.
The maximum OI outstanding for Calls was at 5400 SP (9.29mn) and that for Puts was at 5000 SP (8.48 mn).
The respective Support and Resistance levels are: Resistance 5232.58 -- Pivot Point 5211.51--Support 5176.18.
The Nifty Put Call Ratio (PCR) OI wise stood at 1.24 for July -month contract.
The top five scrips with highest PCR on OI were AIL 4.00, MRF 2.00, DIVISLAB 1.80, Grasim 1.25, and OPTO Circuit 1.17
Among the most active underlying, Unitech witnessed contraction of 0.96 million of Open Interest in the July month futures contract followed by Jaiprakash Associates witnessed an addition of 2.08 million in the July month futures. Also, Tata Motors witnessed an addition of 0.55 million in Open Interest in the July month contract. Finally, Shree Renuka Sugars witnessed an addition of 0.24 million of Open Interest in the near month futures contract.
