Nifty ends lower on sluggish global cues; WPI data eyed

CNX Nifty ended lower for the third consecutive day on Wednesday amid concerns that the central bank will not cut interest rates at its policy meet next week amid rising retail inflation. On the global front, Asian shares fell on Wednesday on investor concerns that the recent rally in global equities was running out of steam, while sterling remained vulnerable after weak UK data fed fears of a triple-dip recession. Moreover, European stock markets opened mostly lower on Wednesday, tracking losses seen in Asia markets.

Back home, pressurized by sluggish global cues, Indian equity benchmark made a gap-down start with breaching its crucial 5,900 levels respectively. The US markets mostly made a soft closing overnight. In the first half of trade, market traded in negative territory as traders’ opted cautious approach awaiting WPI inflation numbers to be announced on March 14, as it will be the deciding factor for the RBI to go for a rate cut. Market continued its weak trade despite the government describing the 2.4 percent industrial growth in February as bottoming out of the downturn and hopes that economic indicators would look up in the coming months. Market extended its losses in the second half too on account of selling in front line counters and taking cues from European counterparts. Further, investors’ sentiments were also weighed down by both Morgan Stanley and HSBC, which have cut their India’s economic growth forecasts for 2013-14 to 6.0% from 6.2% to reflect lower-than-expected growth in the October-December quarter. Selling was witnessed in all major indices except FMCG and pharma. Finally, Nifty ended the session near its intra-day level with a loss of 62 points.    

 Meanwhile, most of the sectoral indices on the NSE made a negative closing. CNX Media down 2.82%, CNX Finance down 2.19%, CNX PSU Bank down 2.00% and CNX PSE down 1.55% remained the top losers in the trade. While, CNX FMCG up by 0.47% and CNX Pharma up by 0.18% remained the gainers in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 7.07% and reached 16.20.

The India VIX witnessed an addition of 7.07% at 16.20 as compared to its previous close of at 15.13 on Tuesday.

The 50-share CNX Nifty lost 62.90 points or 1.06 % to settle at 5,851.20.

Nifty March 2013 futures closed at 5,867.75 on Wednesday at a premium of 16.55 points over spot closing of 5,851.20, while Nifty April 2013 futures ended at 5,903.85, at a premium of 52.65 points over spot closing. Nifty March futures saw contraction of 0.61 million (mn) units taking the total outstanding open interest (OI) to 15.46 mn units. The near month March 2013 derivatives contract will expire on March 28, 2013.

From the most active contracts, JP Associates March 2013 futures were trading at a premium of 0.40 points at 75.65 compared with spot closing of 75.25. The number of contracts traded was 9,673.

Tata Motors March 2013 futures were trading at a premium of 1.10 points at 302.00 compared with spot closing of 300.90. The number of contracts traded was 12,161.

DLF March 2013 futures were trading at a premium of 1.20 points at 281.65 compared with spot closing of 280.45. The number of contracts traded was 13,014.

United Spirits March 2013 futures were at a premium of 15.00 points at 1970.20 compared with spot closing of 1955.20. The number of contracts traded was 13,746.

Reliance Industries March 2013 futures were at a premium of 5.25 points at 847.00 compared with spot closing of 841.75. The number of contracts traded was 14,543.

Among Nifty calls, 6,000 SP from the March month expiry was the most active call with an addition of 0.70 million open interest.

Among Nifty puts, 5,700 SP from the March month expiry was the most active put with an addition of 1.09 million open interest.

The maximum OI outstanding for Calls was at 6000 SP (7.42 mn) and that for Puts was at 5,700 SP (13.09 mn).

The respective Support and Resistance levels are: Resistance 5882.62-- Pivot Point 5862.43-- Support 5831.02.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.62 for March -month contract.

The top five scrips with highest PCR on OI were Colpal 4.00, Divislab 2.38, HDFC Bank 2.33,Kotak Bank 2.03, and TCS 1.92.

Among most active underlying, Unitech witnessed contraction of 5.19 million of Open Interest in the March month futures contract followed by IFCI which witnessed an addition of 1.03 million of Open Interest in the near month contract. Meanwhile, Jaiprakash Associates witnessed of contraction of 0.80 million in the March month futures. Also, RCOM witnessed contraction of 1.02 million in Open Interest in the March month contract. Finally, Hindalco witnessed an addition of 3.00 million of Open Interest in the near month futures contract.