Nifty ends in red ahead of RBI’s mid-quarter monetary policy review

S&P CNX Nifty ended lower on Monday ahead of the RBI’s mid-quarter monetary policy review to be announced on December 18 and traders booked profit in some large cap stocks. On global front, Asian markets closed mostly down, as Asian equities succumbed to profit-taking from last week’s rally as investors wound down positions ahead of the holiday season amid worries that Washington won’t avert the fiscal cliff of tax hikes and spending cuts that could hurt the US and global economy. Meanwhile, European shares continued to showcase negative trend given uncertainty surrounding US budget talks.

Back home, market made a flat to negative start and turned green as some support came from Prime Minister Manmohan Singh’s comment that the steps taken on the economic front were ‘only the beginning of a process’ and there would be no looking back. In late morning session, investors preferred to book profits ahead of the RBI's mid-quarter monetary policy review on Tuesday. Investors’ mood remained quite cautious in noon session after the government lowered the growth projection for the current financial year to 5.7-5.9 per cent from 7.6 per cent estimated earlier. In the late afternoon session, market pared losses but continued its weak trade to intraday low on account of profit booking in frontline counters and taking cues from subdued European counterparts. However, in the end market recovered some points and closed in red.

Meanwhile, most of the sectoral indices on the NSE settled on a mixed note, CNX Metals up by 1.46%, CNX Media up by 0.98%, CNX PSU Banks up by 0.93%, CNX Auto up by 0.64% and CNX Reality up by 0.58% remained the top gainers in the trade. While CNX IT down 1.19% CNX Services down 0.65%, CNX FMCG down 0.55%, CNX Finance down 0.44% and CNX Energy down 0.29% remained the top loser. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 4.85% and reached 14.92.

The India VIX witnessed an addition of 4.85% at 14.92 as compared to its previous close of at 14.23 on Friday.

The 50-share S&P CNX Nifty lost 21.70 points or 0.37% to settle at 5,857.90.

Nifty December 2012 futures closed at 5889.35 on Monday at a premium of 31.45 points over spot closing of 5,857.90, while Nifty January 2013 futures ended at 5927.10, at a premium of 69.20 points over spot closing. Nifty December futures saw contraction of 0.03 million (mn) units taking the total outstanding open interest (OI) to 21.33 mn units. The near month December 2012 derivatives contract will expire on December 27, 2012.

From the most active contracts, JP Associates December 2012 futures were at a premium of 0.50 at 100.40 compared with spot closing of 99.90. The number of contracts traded was 8,103.

NMDC December 2012 futures were at a premium of 1.35 at 164.40 compared with spot closing of 163.05. The number of contracts traded was 11,373.

Hindalco Industries December 2012 futures were at a premium of 0.95 point at 125.00 compared with spot closing of 124.05. The number of contracts traded was 8,853.

Tata Motors December 2012 futures were at a premium of 1.50 point at 295.05 compared with spot closing of 293.55. The number of contracts traded was 15,715.

Tata Steel December 2012 futures were at a premium of 3.35 point at 401.80 compared with spot closing of 398.45. The number of contracts traded was 13,140.

Among Nifty calls, 6,000 SP from the December month expiry was the most active call with contraction of 0.98 million open interest.

Among Nifty puts, 5,800 SP from the  December month expiry was the most active put with  an addition  of 0.14 million open interest.

The maximum OI outstanding for Calls was at 6000 SP (12.23 mn) and that for Puts was at 5800 SP (9.31 mn).

The respective Support and Resistance levels are: Resistance 5899.25 -- Pivot Point 5864.70 -- Support 5843.35.

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 2.06, ACC 1.44, Bank Baroda 1.36, PNB 1.33 and Axis Bank 1.10.

Among most active underlying, Suzlon witnessed contraction of 20.97 million of Open Interest in the December month futures contract followed by IFCI which witnessed  contraction of 0.56 million of Open Interest in the near month contract. Meanwhile, NHPC witnessed contraction of 2.72 million in the December month futures. Also, IFCI witnessed an addition of 0.01 million in Open Interest in the December month contract. Finally, Jaiprakash Associates witnessed contraction of 2.10 million of Open Interest in the near month futures contract.