Nifty ends lower for second straight day

The equity benchmark-Nifty---continued its southward journey for second day in a row on Monday, closing lower with losses of over one percentage. Market made a cautious start of the trading session, as traders remained concerned with India Meteorological Department’s statement that the overall monsoon deficiency in the country has reached 43 per cent due to its sluggish pace. Some cautiousness also came in with a report stating that the continuing of high crude and gold imports pushed India’s trade deficit to a six-month high of $15.36 billion in May.

Key index extended losses towards the end of the session, amid report that housing finance growth is set to slow down to 13-15 percent this fiscal, lower than the average of the past three years, due to the lingering liquidity issues faced by non-banking lenders. Market participants ignored the Reserve Bank of India’s report showing that inching closer to its historic peak, India's forex kitty increased by $1.686 billion to $423.554 billion for the week to June 7. Traders also overlooked a report that India's exports grew by 3.93 per cent to $30 billion in May on account of healthy growth in sectors such as chemicals, pharmaceuticals and engineering, while imports too rose by 4.31 per cent to $45.35 billion in May.

All sectoral indices ended in red on NSE. The top gainers from the F&O segment were Apollo Tyres, Hexaware Technologies and GMR Infrastructure. On the other hand, the top losers were Jet Airways (India), PC Jeweller and Shriram Transport Finance Company. In the index option segment, maximum OI continues to be seen in the 11,900-12,100 calls and 11,200-11,700 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 5.43 and reached 14.65. The 50-share Nifty was down by 151.15 points or 1.28% to settle at 11,672.15.

Nifty June 2019 futures closed at 11697.55 on Monday, at a premium of 25.40 points over spot closing of 11672.15, while Nifty July 2019 futures ended at 11730.85, at a premium of 58.70 points over spot closing. Nifty June futures saw an addition of 0.39 million (mn) units, taking the total outstanding open interest (OI) to 18.86 mn units. The near month derivatives contract will expire on June 27, 2019.

From the most active contracts, Yes Bank June 2019 futures traded at a premium of 0.70 points at 116.60 compared with spot closing of 115.90. The numbers of contracts traded were 36,609.

Shriram Transport Finance Company June 2019 futures traded at a premium of 2.75 points at 1016.75 compared with spot closing of 1014.00. The numbers of contracts traded were 27,116.

Indiabulls Housing Finance June 2019 futures traded at a premium of 5.15 points at 654.15 compared with spot closing of 649.00. The numbers of contracts traded were 25,968.

Reliance Industries June 2019 futures traded at a premium of 3.20 points at 1285.45 compared with spot closing of 1282.25. The numbers of contracts traded were 25,759.

Tata Steel June 2019 futures traded at a premium of 0.90 points at 473.70 compared with spot closing of 472.80. The numbers of contracts traded were 20,713.

Among Nifty calls, 11,800 SP from the June month expiry was the most active call with an addition of 0.94 million open interests. Among Nifty puts, 11,700 from the June month expiry was the most active put with a contraction of 0.19 million open interests. The maximum OI outstanding for Calls was at 12,000 SP (2.58 mn) and that for Puts was at 11,500 SP (2.56 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,791.55 -- Pivot Point 11,724.65 -- Support -- 11,605.25.

The Nifty Put Call Ratio (PCR) finally stood at 1.17 for June month contract. The top five scrips with highest PCR on OI were Bosch (1.64), TCS (1.41), Colgate-Palmolive (1.38), MRPL (1.27) and Tata Motors DVR (1.00).

Among most active underlying, Reliance Industries witnessed an addition of 0.47 million units of Open Interest in the June month futures contract, followed by State Bank of India witnessing an addition of 0.08 million units of Open Interest in the June month contract, Axis Bank witnessed an addition of 0.14 million units of Open Interest in the June month contract, Tata Steel witnessed a contraction of 0.77 million units of Open Interest in the June month contract and Indiabulls Housing Finance witnessed a contraction of 0.32 million units of Open Interest in the June month future contract.