Nifty ends below 12250 mark

Indian benchmark Nifty made negative close by ending the session with cut of over a percent. The market opened at record peak, as traders took encouragement with Union Road Transport and Highways Minister Nitin Gadkari’s statement that the goal of making India a $5 trillion economy by 2024 was difficult but not impossible. He added that it can be achieved by increasing domestic production and reducing dependence on imports. However, Nifty turned the wheel to enter into red zone, as anxiety spread among traders with private report stating that surging inflation and slowing growth are raising serious concerns about the future growth prospects of the economy and as a remedial measure the government should resolve supply side hurdles and ensure more stringent governance norms.

Further, market started extending its losses and never looked back till the end of the session, as street remained worried with the former finance secretary Subhash Chandra Garg’s statement that the government's tax collection is likely to fall short of its estimate by Rs 2.5 lakh crore or 1.2% of GDP in 2019-20, and called for scrapping of dividend distribution tax. The mood on the street also remained cautious with private report stating that the blocking Huawei from rolling out 5G technology may cause loss of up to $63 billion in the GDP of top eight technology markets, and at least $4.7 billion in case of India, by 2035. Finally, Nifty ended the sluggish day of trade below its crucial 12250 mark. 

Most of the NSE sectoral indices ended in red, except FMCG and Realty. The top gainers from the F&O segment were Vodafone Idea, NMDC and Power Grid Corporation of India. On the other hand, the top losers were Power Finance Corporation, L&T Finance Holdings and Kotak Mahindra Bank. In the index option segment, maximum OI continues to be seen in the 12250 - 12,700 calls and 11,900 - 12,350 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 9.08% and reached 15.41. The 50 share Nifty was down by 127.80 points or 1.03% to settle at 12,224.55.

Nifty January 2020 futures closed at 12263.15 (LTP) on Monday, at a premium of 38.60 points over spot closing of 12224.55, while Nifty February 2020 futures ended at 12302.45 (LTP), at a premium of 77.90 points over spot closing. Nifty December futures saw a contraction of 0.42 million (mn) units, taking the total outstanding open interest (OI) to 13.18 mn units. The near month derivatives contract will expire on January 30, 2020 (Provisional).

From the most active contracts, Kotak Mahindra Bank January 2020 futures traded at a premium of 3.00 points at 1620.00 (LTP) compared with spot closing of 1617.00. The numbers of contracts traded were 49,410 (Provisional).

Reliance Industries January 2020 futures traded at a premium of 4.15 points at 1536.35 (LTP) compared with spot closing of 1532.20. The numbers of contracts traded were 47,837 (Provisional).

Bharti Airtel January 2020 futures traded at a premium of 3.90 points at 510.85 (LTP) compared with spot closing of 506.95. The numbers of contracts traded were 36,623 (Provisional).

Tata Consultancy Services January 2020 futures traded at a premium of 0.50 points at 2174.50 (LTP) compared with spot closing of 2174.00. The numbers of contracts traded were 33,778 (Provisional).

HDFC Bank January 2020 futures traded at a premium of 2.30 points at 1259.65 (LTP) compared with spot closing of 1257.35. The numbers of contracts traded were 26,200 (Provisional).

Among, Nifty calls, 12400 SP from the January month expiry was the most active call with an addition of 0.54 million open interests. Among Nifty puts, 12300 from the January month expiry was the most active put with a contraction of 0.13 million open interests. The maximum OI outstanding for Calls was at 12500 SP (3.17 mn) and that for Puts was at 12000 SP (3.39 mn). The respective Support and Resistance levels of Nifty are: Resistance 12,364.40 -- Pivot Point 12,290.65 -- Support -- 12,150.80.

The Nifty Put Call Ratio (PCR) finally stood at 1.20 for January month contract. The top five scrips with highest PCR on Escorts (1.34), Bharti Airtel (1.22), DLF (1.12), Balkrishna Industries (1.10) and UltraTech Cement (1.09).

Among most active underlying, Reliance Industries witnessed an addition of 0.11 million units of Open Interest in the January month futures contract, followed by Kotak Mahindra Bank witnessing an addition of 0.06 million units of Open Interest in the January month contract, Tata Consultancy Services witnessed a contraction of 0.86 million units of Open Interest in the January month contract, Bharti Airtel witnessed a contraction of 3.05 million units of Open Interest in the January month contract and SBIN witnessed an addition of 1.51 million units of Open Interest in the January month future contract (Provisional).