Nifty ekes out slender gains in cautious trade

CNX S&P Nifty witnessed consolidation on Monday amid investors adopting a cautious stance after three continues days of rally and a weak rupee. However, the index traded cautiously throughout the session as cues from global markets remain subdued as all the Asian counters went home with red mark, as investors were not ready to take any strong positions before a series of key events this week, such as US presidential election and China's leadership transition. Hong Kong markets closed lower, tracking two sets of services sector data. Moreover, European counters too traded cautiously in the early deals on concern that Greece will struggle to secure a bailout. The Greek Prime Minister Antonis Samaras is facing resistance from his coalition partners before lawmakers vote this week on measures required to receive aid. Also UK’s services PMI came at lowest since December 2010.

Earlier, the Indian market made a flat-to-negative start tracking weak global cues but, immediately turned into the red supported by C Rangarajan’s statement over India’s credit rating that there is no case for lowering India’s credit rating and global agencies need to look at the international scenario before taking any rating action. The gains remain capped as some disappointing second quarter result added pressure in the markets, the PSU lender Allahabad Bank reported a fall of 52.01% in its net profit at Rs 234.20 crore for the quarter ended September 30, 2012 as compared to Rs 488.02 crore for the same quarter in the previous year, its NPA too increased to 2.95% for the quarter as against 1.77% in the previous quarter. Market turned red in the noon trade following weak opening in European markets. Service sector activity in India, which expanded at the slowest pace in six months in October, too added to the pessimistic environment. According to the seasonally adjusted HSBC Business Activity Index, the service sector activity slowed to 53.5 in October, against September's seven-month high of 55.8. In the mid noon trade, market touched its intraday low as cues from the money market remained uninspiring for most part of the session as the rupee continued its streak of depreciation. The currency touched a low of 54.56 a dollar in intraday trading after opening at 54.11 a dollar in the morning. But, in the last half an hour of trade, market made a decent comeback regaining its green terrain supported by defensive FMCG sector, which was able to make some mark with gain of over a percent. Finally, Nifty ended the session tad above its crucial 5,700 mark with a marginal gain of 6 points.

Meanwhile, most of the sectoral indices on the NSE were settled in the red, CNX Metal remained the major loser, down 0.85% followed by CNX PSU Bank down 0.55% and CNX Auto down by 0.55% while CNX FMCG and CNX Media rose 1.16% and 0.83% respectively in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, increased by 7.10% and reached 14.63.

The India VIX witnessed an addition of 7.10% at 14.63 as compared to its previous close of at 13.66 on Friday.

The 50-share S&P CNX Nifty gained 6.50 points or 0.11% to settle at 5,704.20.

Nifty November 2012 futures closed at 5739.65 on Monday at a premium of 35.45 points over spot closing of 5,704.20, while Nifty December 2012 futures ended at 5771.75, at a premium of 67.55 points over spot closing. Nifty November futures saw an addition of 0.11 million (mn) units taking the total outstanding open interest (OI) to 18.66 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 2.55 at 271.65 compared with spot closing of 269.10. The number of contracts traded was 14,042.

Tata Steel November 2012 futures were trading at a premium of 2.70 at 400.40 compared with spot closing of 397.70. The number of contracts traded was 7,484.

United Spirits November 2012 futures were at a premium of 5.65 point at 1230.00 compared with spot closing of 1224.35. The number of contracts traded was 19,898.

Reliance Industries November 2012 futures were at a premium of 6.65 point at 811.65 compared with spot closing of 805.00. The number of contracts traded was 7,407.

Cipla November 2012 futures were at a premium of 2.60 point at 383.60 compared with spot closing of 381.00. The number of contracts traded was 7,053.

Among Nifty calls, 5900 SP from the November month expiry was the most active call with marginal addition in open interest.

Among Nifty puts, 5600 SP from the November month expiry was the most active put with an addition of 0.27 million open interest.

The maximum OI outstanding for Calls was at 5900 SP (6.73 mn) and that for Puts was at 5600 SP (6.77 mn).

The respective Support and Resistance levels are: Resistance 5715.77 -- Pivot Point 5697.63 -- Support 5686.07.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.16 for November -month contract.

The top five scrips with highest PCR on OI were GUJ Fluoro 3.73, Maruti 1.73, Tata Motors 1.75, Hero Moto Co 1.37, and Titan 1.35.

Among most active underlying, Jaiprakash Associates witnessed contraction of 0.53 million of Open Interest in the November month futures contract followed by RCOM which witnessed an addition of 0.55 million of Open Interest in the near month contract. Meanwhile, Shree Renuka Sugars witnessed contraction of 0.31 million in the November month futures. Also, Tata Motors witnessed an addition of 0.99 million in Open Interest in the November month contract. Finally, Hindalco witnessed an addition of 0.30 million of Open Interest in the near month futures contract.