Bulls continue to capitalize on firm global cues; Nifty shied away from 5,700 mark

Buoyed by firm global cues, Nifty extended its northward journey for third consecutive day exhibiting an excellent day of trade garnering about a percentage point. On the global front, most of the Asian equity indices ended their session in the green terrain on the back of positive US economic data, which has raised hopes of global recovery. Regional stocks ended higher ahead of next week’s meeting of the 18th National Congress of the Communist Party in Beijing. Hong Kong market touched its highest level since August 2011 lightened up by strength in Chinese financials and growth-sensitive sectors. However, European counters stuck almost unchanged in early deals ahead of US jobs data that will provide the last major signal on the state of the world’s largest economy before voters go to polls on Nov 6.

Back home, Indian benchmark made a gap-up opening supported by strong global cues moreover broad based buying in key heavyweight too supported the upmove. Afterwards, market continued to trade firmly through the session holding gain of about a percent after the Finance Minister P Chidambaram met Foreign Institutional Investors (FIIs) to make them informed about the current economic situations and on the steps being taken by the government to boost the economic growth. Hefty buying in consumer durable space too supported the sentiments as sector spurted over one and a half percent on hopes that sales growth would pick up in November ahead of the festive season. Sentiments also got some boost after Metal stocks rose for the second straight session on improved economic data from China. Also, Cement stocks too were in demand as companies from this sector would start unveiling monthly sales volume data for October 2012. Nevertheless, even Q2 earnings of Wipro, buttressed the sentiment.  India's No. 3 software services provider -- Wipro -- topping quarterly profit estimates, forecasting modest growth and easing fears that global economic woes will curb outsourcing spending, spelled optimism across the Information Technology  (IT) pivotal. Nifty regained its crucial 5,700 mark in the noon trade supported by rally in telecom stocks like Idea Cellular, Reliance Communication and Tata Communication, which edged higher after EGoM allowed the existing players to retain a maximum of 2.5 MHz in prime band spectrum of 900 MHz frequency band instead of the telecom regulator’s suggestion to switch to the 1,800 MHz band when their current licences expire, provided they pay a price which will be determined later through auction. However, the index witnessed profit booking towards the fag end of the trade and Nifty snapped the session tad below important 5,700 mark garnering about a percent gain.

Meanwhile, all the sectoral indices on the NSE settled in the positive territory with CNX PSU Bank gaining the most, up 2.08% followed by CNX Auto up by 1.38%, CNX Media up by 1.33% and Bank Nifty up by 1.29% in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, declined 2.98% and reached 13.66.

The India VIX witnessed contraction of 2.98% at 13.66 as compared to its previous close of at 14.08 on Thursday.

The 50-share S&P CNX Nifty gained 52.65 points or 0.93% to settle at 5,697.70.

Nifty November 2012 futures closed at 5739.55 on Friday at a premium of 41.85 points over spot closing of 5,697.70, while Nifty December 2012 futures ended at 5771.95, at a premium of 74.25 points over spot closing. Nifty November futures saw an addition of 1.36 million (mn) units taking the total outstanding open interest (OI) to 18.54 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 1.80 at 272.15 compared with spot closing of 270.35. The number of contracts traded was 18,941.

Apollo Tyre November 2012 futures were trading at a premium of 1.05 at 87.15 compared with spot closing of 86.10. The number of contracts traded was 11,456.

Tata Steel November 2012 futures were at a premium of 1.80 point at 404.70 compared with spot closing of 402.90. The number of contracts traded was 9,702.

Reliance Industries November 2012 futures were at a premium of 8.85 point at 814.55 compared with spot closing of 805.70. The number of contracts traded was 14,401.

ICICI Bank November 2012 futures were at a premium of 3.70 point at 1086.05 compared with spot closing of 1082.35. The number of contracts traded was 13,980. 

Among Nifty calls, 5900 SP from the November month expiry was the most active call with an addition of 0.68 million open interest.

Among Nifty puts, 5600 SP from the November month expiry was the most active put with an addition of 0.79 million open interest.

The maximum OI outstanding for Calls was at 5900 SP (6.73 mn) and that for Puts was at 5600 SP (6.49 mn).

The respective Support and Resistance levels are: Resistance 5711.82 -- Pivot Point 5697.18 -- Support 5683.07.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.12 for November -month contract.

The top five scrips with highest PCR on OI were GUJ Fluoro 8.14, Tata Motors 1.84, Maruti 1.73, Hero Moto Co 1.48, and Titan 1.45.

Among most active underlying, Unitech witnessed contraction of 2.54 million of Open Interest in the November month futures contract followed by Jaiprakash Associates which witnessed an addition of 0.29 million of Open Interest in the near month contract. Meanwhile, RCOM witnessed contraction of 0.98 million in the November month futures. Also, Tata Motors witnessed contraction of 1.03 million in Open Interest in the November month contract. Finally, HDIL witnessed an addition of 0.53 million of Open Interest in the near month futures contract.