Nifty ends into red despite stronger Oct IIP data

S&P CNX Nifty remained volatile for the whole session and closed down in red, amid rising consumer price inflation which dashed hopes of a rate cut by the central bank. On global front, US markets extended their gains taking positive cues from some upbeat economic data from the Europe and hopes that Fed will announce a new round of Treasury bond purchases. Asian markets closed in green barring Jakarta Composite, while the European markets were showing mixed trend. In Europe, finance ministers from the 17 European Union countries that use the euro conferred on the results of a key bond buyback designed to ease Greece’s crippling debt load and unlock vital rescue loans. Besides, German investor confidence jumped more than forecast to a seven-month high in December on speculation Europe’s largest economy will gather momentum next year.

Back home Indian equity markets made a positive opening amid supportive global cues and investors remained optimistic ahead of IIP data for the month of October. India’s index of industrial production (IIP), a key measure of industrial output, expanded at its fastest pace in 16 months at 8.2% in October versus a contraction of 0.4% in September. This was the highest growth that the IIP has touched since June 2011. After IIP data was announced market declined despite a stronger data because of diminishing hope of rate cut by the RBI. In afternoon the nifty taking a U-turn entered into the green territory due to the rebound of banking stocks, after reports suggested some consensus for banking bill, being developed in Parliament. Market pared gains to in last, closing near lowest point of the day in absence of any positive upside triggers.

Meanwhile, most of the sectoral indices on the NSE settled in red, CNX PSE down 1.18%, CNX MNC down 0.92%, CNX Commodities down 0.64%, CNX Metal down 0.62% and CNX Finance down 0.55% remained the top losers in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, down 1.09% and reached 14.51.

The India VIX witnessed contraction of 1.09% at 14.51 as compared to its previous close of at 14.67 on Tuesday.

The 50-share S&P CNX Nifty lost 10.80 points or 0.18% to settle at 5,888.00.

Nifty December 2012 futures closed at 5928.25 on Wednesday at a premium of 40.25 points over spot closing of 5,888.00, while Nifty January 2013 futures ended at 5963.65, at a premium of 75.65 points over spot closing. Nifty December futures saw an addition of 0.78 million (mn) units taking the total outstanding open interest (OI) to 21.12 mn units. The near month December 2012 derivatives contract will expire on December 27, 2012.

From the most active contracts, Reliance Communications December 2012 futures were at a premium of 0.65 at 77.85 compared with spot closing of 77.20. The number of contracts traded was 14,586.

JP Associates December 2012 futures were at a premium of 0.65 at 105.05 compared with spot closing of 104.40. The number of contracts traded was 15,084.

NMDC December 2012 futures were at a discount of 0.20 point at 154.20 compared with spot closing of 154.40. The number of contracts traded was 32,335.

Tata Motors December 2012 futures were at a premium of 2.40 point at 278.60 compared with spot closing of 276.20. The number of contracts traded was 11,838.

ICICI Bank December 2012 futures were at a premium of 12.35 point at 1122.10 compared with spot closing of 1109.75. The number of contracts traded was 14,419.  Among Nifty calls, 6,000 SP from the December month expiry was the most active call with an addition of 0.78 million open interest.

Among Nifty puts, 5,800 SP from the  December month expiry was the most active put with  an addition  of 0.27 million open interest.

The maximum OI outstanding for Calls was at 6000 SP (11.06 mn) and that for Puts was at 5800 SP (8.16 mn).

The respective Support and Resistance levels are: Resistance 5916.98 -- Pivot Point 5895.62 -- Support 5866.63.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.21 for December -month contract.

The top five scrips with highest PCR on OI were Bajaj-Auto 1.74, Abirlanuvo 1.25, PNB 1.17, Asian Paint 1.13 and Bank Baroda 1.10.

Among most active underlying, Unitech witnessed an addition of 5.72 million of Open Interest in the December month futures contract followed by IFCI which witnessed an addition of 1.32 million of Open Interest in the near month contract. Meanwhile, Jaiprakash Associates witnessed an addition of 1.21 million in the December month futures. Also, Reliance Communications witnessed an addition of 1.74 million in Open Interest in the December month contract. Finally, Shree Renuka Sugars witnessed an addition of 1.24 million of Open Interest in the near month futures contract.