Nifty ends higher on rate-cut hopes

CNX Nifty rose to its highest level in two and a half year on Thursday amid buying in banking and realty stocks on growing optimism that the Reserve Bank of India (RBI) will slash key rates in the upcoming policy review in June after headline inflation eased to 41-month low-level. Further, record inflows from foreign institutional investors (FIIs) in debt and equities also supported the sentiment. On the global front, Asian markets made a mixed closing, while European counter opened lower on the back of disappointing corporate earnings. 

Back home, Indian equity benchmark though made a negative start, recovered soon on the back of firm global cues as the US market ended up in the last session. In the first half, market traded in green as sentiments remained optimistic on rate cut hopes. Further, sentiments also got a boost after Moody’s statement that Indian economy is expected to pick up and grow in the range of 5.5-6.5 percent in 2013. Market continued its positive trade in the second half too, on the back of buying in selected stocks. Investors were seen piling position in banking, realty and energy stocks. Finally, Nifty ended the session with a gain of 23 points.      

Meanwhile, most of the sectoral indices on the NSE made a positive closing. CNX Realty up by 1.85%, CNX Energy up by 1.27%, CNX Pharma up by 1.25%, CNX Finance up by 0.95% and CNX PSU Bank up by 0.62% remained the top gainers in the trade. While, CNX IT down 1.06%, CNX FMCG down 0.85%, CNX Media down 0.79% and CNX Auto down 0.48% remained the losers in the trade. While, the India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, down by 2.15% and reached 17.74.

The India VIX witnessed contraction of 2.15% at 17.74 as compared to its previous close of at 18.13 on Wednesday. The 50-share CNX Nifty gained 23.15 points or 0.38% to settle at 6,169.90.

Nifty May 2013 futures closed at 6178.05 on Thursday at a premium of 8.15 points over spot closing of 6169.90, while Nifty June 2013 futures ended at 6182.45, at a premium of 12.55 points over spot closing. Nifty May futures saw an addition of 0.51 million (mn) units taking the total outstanding open interest (OI) to 25.60 mn units. The near month May 2013 derivatives contract will expire on May 30, 2013.

From the most active contracts, JP Associates May 2013 futures were trading at a discount of 0.05 points at 80.15 compared with spot closing of 80.20. The number of contracts traded was 18,134.

DLF May 2013 futures were trading at a premium of 1.55 points at 244.00 compared with spot closing of 242.45. The number of contracts traded was 24,636.

Reliance Industries May 2013 futures were trading at a premium of 5.40 points at 844.40 compared with spot closing of 839.00. The number of contracts traded was 22,559.

Yes Bank May 2013 futures were at a discount of 3.70 points at 538.35 compared with spot closing of 542.05. The number of contracts traded was 12,185. 

ICICI Bank May 2013 futures were at a discount of 14.65 points at 1191.50 compared with spot closing of 1206.15. The number of contracts traded was 12,891.  

Among Nifty calls, 6,200 SP from the May month expiry was the most active call with an addition of 0.27 million open interest.

Among Nifty puts, 6,000 SP from the May month expiry was the most active put with an addition of 0.58 million open interest.

The maximum OI outstanding for Calls was at 6,200 SP (7.14 mn) and that for Puts was at 6,000 SP (7.91 mn).

The respective Support and Resistance levels are: Resistance 6195.38 -- Pivot Point 6161.82 -- Support 6136.33.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.40 for May-month contract.

The top five scrips with highest PCR on OI were Siemens 2.45, Kotak Bank 2.10, Bharti Airtel 1.90, Ranbaxy 1.83 and Indus Ind Bk 1.44.

Among most active underlying, Unitech witnessed an addition of 2.89 million of Open Interest in the May month futures contract followed by Jaiprakash Associates which witnessed an addition of 0.60 million of Open Interest in the near month contract. Meanwhile, Rcom witnessed contraction of 0.79 million in the May month futures. Also, IFCI witnessed an addition of 0.03 million in Open Interest in the May month contract. Finally, R Power witnessed an addition of 0.40 million of Open Interest in the near month futures contract.