Nifty witnesses bloodbath on Tuesday: end below 10,800 marks

03 Sep 2019 Evaluate

NSE gauge -- Nifty50 traded with a negative bias throughout the day and ended the day’s trade with a cut of over two percentage points amid report that India's GDP growth slipped to an over six-year low of 5 per cent in the June quarter of 2019-20, hit by a sharp deceleration in manufacturing output and subdued farm sector activity. Market made gap down opening as government data showing that growth of eight core industries -- coal, crude oil, natural gas, refinery products, fertiliser, steel, cement and electricity -- dropped to 2.1 per cent in July, mainly due to contraction in coal, crude oil and natural gas production. The eight core sector industries had expanded by 7.3 per cent in July last year. Traders remained anxious with IHS Markit India Manufacturing Purchasing Managers' Index showing that country's manufacturing sector activity declined to its 15-month low in August, owing to slower increases in sales, output and employment.

Extending bears run for second half, market ended with over two a percentage cut, as sentiment on the street weakened with a report that market regulator SEBI's annual report stating that as macroeconomic headwinds weighed on investor sentiments through the year, foreign portfolio investors pulled out Rs 38,930 crore in 2018-19. Traders remain concerned with a private report that India's economic growth dropping to an over six-year low of 5 percent in April-June 2019 is indicating a ‘significant deceleration’ in both investment and consumer demand.

All the NSE sectoral indices ended in red .The top gainers from the F&O segment were IDBI Bank, TVS Motor Company and Cadila Healthcare. On the other hand, the top losers were Canara Bank, Multi Commodity Exchange of India and Union Bank of India. In the index option segment, maximum OI continues to be seen in the 11,600 - 11,800 calls and 10,700 - 10,900 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 10.89% and reached 18.05.The 50 share Nifty was down by 225.35 points or 2.04% to settle at 10,797.90.

Among, Nifty calls, 11,000 SP from the September month expiry was the most active call with an addition of 0.58 million open interests. Among Nifty puts, 10,800 from the September month expiry was the most active put with an addition of 0.25 million open interests. The maximum OI outstanding for Calls was at 11,700 SP (2.25 mn) and that for Puts was at 10,800 SP (2.84 mn). The respective Support and Resistance levels of Nifty are: Resistance 10,919.37 --Pivot Point 10,846.03 --Support--10,724.57.

The Nifty Put Call Ratio (PCR) finally stood at 1.16 for September month contract. The top five scrips with highest PCR on Bosch (8.00), Shree Cement (7.00), Ramco Cements (4.67), Cummins India (2.07) and Tata Motors - DVR Ordinary (1.78).

Among most active underlying, Reliance Industries witnessed an addition of 1.63 million units of Open Interest in the September month futures contract, followed by State Bank of India witnessing an addition of 3.02 million units of Open Interest in the September month contract, ICICI Bank witnessed an addition of 4.41 million units of Open Interest in the September month contract, Maruti Suzuki India witnessed an addition of 0.17 million units of Open Interest in the September month contract and Housing Development Finance Corporation witnessed an addition of 1.00 million units of Open Interest in the September month future contract.

Nifty witnesses bloodbath on Tuesday: end below 10,800 marks

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