Nifty ends below 6,000 amid profit booking

CNX Nifty witnessed one of the biggest falls in 2013 on Monday as cautious investors resorted to profit booking after sharp gains last week. Falling for the second straight month, retail inflation declined sharply to 9.39 per cent in April also failed to lift market sentiment. Further, the market extended losses after data showed that the country's trade deficit widened in April 2013 to $17.8 billion, thereby increasing concerns about the current account deficit in Asia's third largest economy. On the global front, Asian markets ended lower as sentiment was hit by selling pressure in commodities. Meanwhile, European markets also opened in red on Monday.

Back home, Indian equity benchmark made a negative start as funds and retail investors opted to book their profits. In the first half, market traded in red as investors’ sentiments turned down after an ASSOCHAM survey stated the contribution of the manufacturing sector in the country's Gross Domestic Product (GDP) may fall below 15 percent in 2013-14 owing to demand slowdown. Meanwhile, India's annual consumer price inflation slowed for the second straight month in April to 9.39%, failed to boost market sentiments. In the second half, market extended its losses and continued weak trade till the end on account of selling in front line blue chip counters and taking cues European counterparts. Further, Reserve Bank of India’s (RBI) investigation report, pointed out major anomalies in banks named in the Cobrapost expose, also deteriorated investors’ sentiments. Selling was witnessed in all major indices of the market. Finally, Nifty ended the session near its intra-day low level with a massive loss of 126 points.
 
Meanwhile, sectoral indices on the NSE made a negative closing. CNX Metal down 2.42%, CNX Infra down 2.40%, CNX Auto down 2.02%, CNX Media down 2.01% and CNX PSE down 1.88% remained the losers in the trade. While, The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 3.98% and reached 17.51.

The India VIX witnessed an addition of 3.98% at 17.51 as compared to its previous close of at 16.86 on   Friday. The 50-share CNX Nifty lost 126.80 points or 2.08% to settle at 5,980.45.

Nifty May 2013 futures closed at 5994.45 on Monday at a premium of 14.00 points over spot closing of 5980.45, while Nifty June 2013 futures ended at 6000.50, at a premium of 20.05 points over spot closing. Nifty May futures saw contraction of 1.19 million (mn) units taking the total outstanding open interest (OI) to 21.30 mn units. The near month May 2013 derivatives contract will expire on May 30, 2013.

From the most active contracts, Reliance Communications May 2013 futures were trading at a premium of 0.25 points at 105.95 compared with spot closing of 105.70. The number of contracts traded was 14,348.

ITC May 2013 futures were trading at a premium of 1.65 points at 337.65 compared with spot closing of 336.00. The number of contracts traded was 10,967.

Tata Steel May 2013 futures were trading at a premium of 0.70 points at 306.00 compared with spot closing of 305.30. The number of contracts traded was 10,402.

Reliance Industries May 2013 futures were at a premium of 3.80 points at 806.80 compared with spot closing of 803.00. The number of contracts traded was 18,664. 

ICICI Bank May 2013 futures were at a discount of 15.15 points at 1134.85 compared with spot closing of 1150.00. The number of contracts traded was 14,630. 

Among Nifty calls, 6,200 SP from the May month expiry was the most active call with contraction of 0.16 million open interest.

Among Nifty puts, 5,700 SP from the May month expiry was the most active put with an addition  of 0.11 million open interest.

The maximum OI outstanding for Calls was at 6,200 SP (7.85 mn) and that for Puts was at 5,700 SP (8.62 mn).

The respective Support and Resistance levels are: Resistance 6065.97 -- Pivot Point 6019.43 -- Support 5933.92.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.29 for May -month contract.

The top five scrips with highest PCR on OI were Siemens 1.80, Bharti Airtel 1.80, Kotak Bank 1.76, Hero Moto Co 1.44, and Indus Ind Bk 1.38.

Among most active underlying, Unitech witnessed contraction of 0.13 million of Open Interest in the May month futures contract followed by Jaiprakash Associates which witnessed an addition of 0.18 million of Open Interest in the near month contract. Meanwhile, Rcom witnessed contraction of 0.81 million in the May month futures. Also, Reliance Power witnessed contraction of 0.46 million in Open Interest in the May month contract. Finally, DLF witnessed contraction of 0.07 million of Open Interest in the near month futures contract.