Nifty ends flat ahead of policy review

S&P CNX Nifty, after witnessing volatile trade for the entire session, ended flat on Monday ahead of the RBI’s third quarter monetary policy review on January 29. On global front, most of the Asian markets ended in green, after the report of rise in Chinese industrial companies’ profits, signaled that the Chinese growth story is again gaining traction. Meanwhile, European markets made a flat start and the major indices were trading on edge with investors awaiting some key economic reports from the US.

Back home, Indian equity benchmark made an optimistic start and traded slightly in the green on Monday’s morning session ahead of the RBI’s third-quarter policy review amid expectations that the central bank will cut interest rates to boost growth into Asia's third-biggest economy. Traction was also supported by FICCI’s prediction that the economy will grow by 6.7% for 2013-14. The chamber has revised its growth forecast upwards from 6.5% to 6.7% for the next fiscal. In the mid-noon session, market pared all its early gains and turned negative as investors remained cautious ahead of the RBI policy meet. Some cautiousness also came in from currency markets as Indian rupee depreciated by 21 paise to 53.88 against the dollar in early noon trade on the Interbank Foreign Exchange on fresh demand for the US currency. Moreover, in the last leg of trade, market continued its volatile trade on the back of profit booking in most of the sectors at higher levels like PSU bank, PSE and pharma. However, losses remain capped as buying in rate sensitive stocks such as automobiles and realty supported the market to an extent. Finally, Nifty ended the session on a flat note.

Meanwhile, most of the sectoral indices on the NSE made a mixed closing. CNX Realty up by 1.61%, CNX Auto up by 0.94%, CNX Media up by 0.59%, CNX Finance up by 0.51% and CNX IT up by 0.32% remained the top gainers in the trade. While CNX Energy down 1.02% CNX PSU Bank down 0.90%, CNX Infra down 0.63%, CNX MNC down 0.37% and CNX Pharma down 0.22% remained the losers. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 2.71% and reached 15.17. 

The India VIX witnessed an addition of 2.71% at 15.17 as compared to its previous close of at 14.77 on Friday.

The 50-share S&P CNX Nifty flat 0.15 points to settle at 6,074.80.

Nifty January 2013 futures closed at 6077.20 on Monday at a premium of 2.40 points over spot closing of 6,074.80, while Nifty February 2013 futures ended at 6117.60, at a premium of 42.80 points over spot closing. Nifty January futures saw contraction of 0.69 million (mn) units taking the total outstanding open interest (OI) to 10.87 mn units. The near month January 2013 derivatives contract will expire on January 31, 2013.

From the most active contracts, Unitech January 2013 futures were trading flat compared with spot closing of 37.30. The number of contracts traded was 12,645.

DLF January 2013 futures were at a discount of 1.00 points at 266.10 compared with spot closing of 267.10. The number of contracts traded was 16,013.

Tata Steel January 2013 futures were at a premium of 1.70 points at 406.80 compared with spot closing of 405.10. The number of contracts traded was 11,681.

Reliance Industries January 2013 futures were at a premium of 3.00 points at 899.75 compared with spot closing of 896.75. The number of contracts traded was 19,477.

ICICI Bank January 2013 futures were at a discount of 2.40 point at 1190.60 compared with spot closing of 1193.00. The number of contracts traded was 17,869.

Among Nifty calls, 6,200 SP from the January month expiry was the most active call with contraction of 0.28 million open interest.

Among Nifty puts, 6,000 SP from the January month expiry was the most active put with an addition of 0.10 million open interest.

The maximum OI outstanding for Calls was at 6200 SP (9.21 mn) and that for Puts was at 6,000 SP (8.66mn).

The respective Support and Resistance levels are: Resistance 6079.33 -- Pivot Point 6083.87 -- Support 6079.33.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.45 for January-month contract.

The top five scrips with highest PCR on OI were SR Transfin 2.86, Infosys 2.09,  Mcleodruss 2.00,  Maruti 1.51and Bharti Airtel 1.44.

Among most active underlying, NHPC witnessed contraction of 13.66 million of Open Interest in the January month futures contract followed by Unitech which witnessed contraction of 15.16 million of Open Interest in the near month contract. Meanwhile, JP Associates witnessed of contraction of 8.58 million in the January month futures. Also, R com witnessed contraction of 5.37 million in Open Interest in the January month contract. Finally, R power witnessed contraction of 4.34 million of Open Interest in the near month futures contract.