Better October auto sales number helps Nifty to end higher

Prolonging its rally for second consecutive session, S&P CNX Nifty garnered about half a percent gain to end tad below its psychological 5,650 level supported by auto and consumer durables stocks. Global cues too aided the sentiments as Asian equity indices ended mostly in the green, led by upbeat Chinese manufacturing data. Data showed China’s manufacturing activity expanded in October for the first time in three months, adding to renewed optimism that the world’s number two economy is beginning to awake from its recent slumber. The purchasing managers’ index (PMI) stood at 50.2 last month, better than 49.8 in September. Moreover, European counters too were trading in the green at this point of time buoyed by relatively robust earnings reports despite economic weakness.

Initially, domestic market made flat to negative start with Nifty swinging between negative and positive zone as anxiety was witnessed ahead of the outcome of Parthasarathi Shome committee’s final report on GAAR. Moreover, the sentiments also got hurt due to fall in index heavyweight Reliance Industries (RIL) after anti-corruption activist-turned-politician Arvind Kejriwal on October 31, 2012, charged RIL’s chairman Mukesh Ambani for getting undue favours from the government over a contract to develop natural gas fields. After touching its intraday low near 5,600 level, Nifty took U-turn and turned green supported by report that India’s manufacturing activity growth inched up in October from September’s 10-month low. HSBC purchasing managers’ index (PMI), a headline index designed to measure the overall health of the manufacturing sector, expanded at steady space of 52.9 in October. Market, afterwards, traded in the green till end as sentiments remained bolstered by growth in eight core sectors, which occupies 37.9% of weightage in the overall Index of Industrial Production (IIP), registered a growth of seven-month high at 5.1% in September, faster than the upwardly revised 2.3% in August and 2.5% in the September month of the previous fiscal, mainly on account of low-base advantage and rapid expansion in coal, cement and petroleum refinery products. The benchmark added some more gains supported by good Auto sales figure for the month of October. Maruti Suzuki India reported 86% growth in October 2012 total sales while; M&M registered 29% growth in October sales. Finally Nifty ended the session with a gain of about half a percent near its crucial 5,650 mark.

Meanwhile, most of the sectoral indices on the NSE were settled in the green, CNX Auto remained the major gainer, up 2.27% followed by CNX Realty up 1.64% and CNX Infra up by 1.14% while, CNX FMCG and CNX Media declined 0.75% and 0.22% in the trade, respectively. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, declined 2.22% and reached 14.08.

The India VIX witnessed contraction of 2.22% at 14.08 as compared to its previous close of at 14.40 on Wednesday.

The 50-share S&P CNX Nifty gained 25.35 points or 0.45% to settle at 5,645.05.

Nifty November 2012 futures closed at 5676.00 on Thursday at a premium of 30.95 points over spot closing of 5,645.05, while Nifty December 2012 futures ended at 5708.70, at a premium of 63.65 points over spot closing. Nifty November futures saw contraction of 0.32 million (mn) units taking the total outstanding open interest (OI) to 17.18 mn units. The near month November 2012 derivatives contract will expire on November 29, 2012.

From the most active contracts, Tata Motors November 2012 futures were trading at a premium of 1.85 at 267.90 compared with spot closing of 266.05. The number of contracts traded was 19,066.

Tata Steel November 2012 futures were trading at a premium of 3.55 at 400.50 compared with spot closing of 396.95. The number of contracts traded was 11,258.

Reliance Industries November 2012 futures were at a premium of 3.75 point at 810.75 compared with spot closing of 807.00. The number of contracts traded was 19,091.

United Spirits November 2012 futures were at a premium of 13.75 point at 1192.65 compared with spot closing of 1178.90. The number of contracts traded was 16,193.

ICICI Bank November 2012 futures were at a premium of 8.30 point at 1063.90 compared with spot closing of 1055.60. The number of contracts traded was 11,976.

Among Nifty calls, 5900 SP from the November month expiry was the most active call with an addition of 0.16 million open interest.

Among Nifty puts, 5300 SP from the November month expiry was the most active put with an addition of 0.75 million open interest.

The maximum OI outstanding for Calls was at 5900 SP (6.05 mn) and that for Puts was at 5300 SP (6.05 mn).

The respective Support and Resistance levels are: Resistance 5662.55 -- Pivot Point 5632.25 -- Support 5614.75.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.09 for November -month contract.

The top five scrips with highest PCR on OI were GUJ Fluoro 8.14, Tata Comm 2.17, Tata Motors 1.60, Maruti 1.56, and Titan 1.49.

Among most active underlying, Unitech witnessed an addition of 0.30 million of Open Interest in the November month futures contract followed by Jaiprakash Associates which witnessed an addition of 0.63 million of Open Interest in the near month contract. Meanwhile, RCOM witnessed an addition of 2.18 million in the November month futures. Also, Tata Motors witnessed contraction of 0.92 million in Open Interest in the November month contract. Finally, Hindalco witnessed an addition of 0.29 million of Open Interest in the near month futures contract.