Nifty surges to its highest close of the year on series expiry day

S&P CNX Nifty got a remarkable closing of the November F&O series gaining over 2% and closed above 5,800 mark for the first time in the year. The series that was bound to make a flat closing suddenly witnessed a sharp rally based on short covering. The market got a good start supported by positive global cues and hopes that the logjam in Parliament will end as the government looked all set to agree on a discussion and vote on FDI in retail after it garnered sufficient numbers. Though there was some cautiousness in early trade as the OECD lowered Indian economic growth forecast in the current fiscal to 4.5, though the Planning Commission Deputy Chairman, Montek Singh Ahluwalia termed OECD’s growth forecast ‘completely wrong’. Trade also got some boost with CBDT notifying the Rajiv Gandhi Equity Savings Scheme, announced earlier during the budget.

On the global front, the mood remained cheerful as the US markets ended in green after President Barack Obama and House Speaker John Boehner bolstered hopes that a budget deal would be reached. The Asian markets too reciprocated the development and ended mostly in green. The major thrust to the domestic market came with the strong start of the European markets, which traded in green despite German unemployment climbing for an eighth straight month in November.

The market has been grinding within a narrow range throughout the last month and the series remained flat. But lot of short covering happened in last session and many high beta stocks rolling including realty and banking were rolled over today. The total rollover was higher than the three months average. Now the traders are optimistic about Nifty reaching 6,000 mark in early December with a bull spread of 5,800 and 6,000. In the F&O segment on NSE, total turnover was of worth record Rs 3,03,821.87 crore while, the number of contracts traded were 1,04,48,346, the put-call ratio for the stood at 0.94.

The bulls remained in charge throughout the day and broad based buying was witnessed on the street. All the sectoral indices on the NSE, barring CNX IT settled in green, CNX Realty surged by 3.61%, Bank Nifty was up by 2.88%, CNX Finance gained 2.87%, CNX Auto was up by 1.93%, CNX Service was higher by 1.84%, CNX Pharma up by 1.49%, CNX Media gained 1.22% and CNX Media up by 1.22% were the major gainers. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged by 10.10% and reached 15.37.

The India VIX witnessed an addition of 10.10% at 15.37 as compared to its previous close of at 13.96 on Tuesday.

The 50-share S&P CNX Nifty gained 97.55 points or 1.70% to settle at 5,825.00.

Nifty December 2012 futures closed at 5869.35 on Thursday at a premium of 44.35 points over spot closing of 5,825.00, while Nifty January 2013 futures ended at 5898.8, at a premium of 73.8 points over spot closing. Nifty December futures saw an addition of 7.22 million (mn) units taking the total outstanding open interest (OI) to 17.88 mn units. The near month December 2012 derivatives contract will expire on December 27, 2012.

From the most active contracts, Tata Motors December 2012 futures were trading at a premium of 0.40 at 278.95 compared with spot closing of 278.55. The number of contracts traded was 26,727.

Tata Steel December 2012 futures were trading at a   premium of 2.2 at 380 compared with spot closing of 377.80. The number of contracts traded was 24,432.

Reliance Industries December 2012 futures were at a premium of 8.85 point at 803.1 compared with spot closing of 794.25. The number of contracts traded was 32,149.

ICICI Bank December 2012 futures were at a premium of 4.45 point at 1089.45 compared with spot closing of 1,085.00. The number of contracts traded was 33,479.

State Bank of India December 2012 futures were at a premium of 8.85 point at 2147.35 compared with spot closing of 2,138.50. The number of contracts traded was 35,382.             

Among Nifty calls, 6,000 SP from the December month expiry was the most active call with an addition of 2.08 million open interest.

Among Nifty puts, 5,600 SP from the  December month expiry was the most active put with  an addition  of 0.64 million open interest.

The maximum OI outstanding for Calls was at 6000 SP (6.03mn) and that for Puts was at 5600 SP (4.91 mn).

The respective Support and Resistance levels are: Resistance 5833.50 -- Pivot Point 5736.10 -- Support 5825.00.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.31 for December -month contract.

The top five scrips with highest PCR on OI were Suzlon 3.21, Bhusan Steel 3.00, PNB 2.93, Bajaj-Auto 2.15 and Abirlanuvo 2.00.