Nifty ends lower amid weak European cues

CNX Nifty ended lower on Wednesday amid weak European cues and lack of fresh buying interest from investors ahead of earnings season. Sluggish European cues weighed heavily on the sentiments as global investors’ turned cautious ahead of the minutes of the Fed meet that are to be released later in the day. European markets made a negative start, while, most of the Asian counters ended in the green on Wednesday. 

Back home, Nifty made a positive start but soon pared gains and traded near the neutral line. Investors’ sentiments turned weak after the International Monetary Fund (IMF) lowered India's growth projections for 2013 to 5.6% from the 5.8% it projected in April. However, market’s losses were restricted as the sentiments got some support from Prime Minister Manmohan Singh's statement that India needs to focus on the manufacturing over the next decade to achieve economy’s potential growth rate of 8-9 percent in the future. In the second half, market extended its losses entering into negative territory and continued its weak trade till the end of session on account of selling in blue chip stocks. Selling was witnessed in banking, auto and realty stocks. Finally Nifty ended the session near its intra-day low level with a loss of 42 points.  

Meanwhile, sectoral indices on the NSE made a negative closing.CNX Energy down 1.79%, CNX PSU Bank down 1.49%, CNX Auto down 1.42%, CNX Media down 1.32% and CNX Realty down 1.31% remained the top losers in the trade. While, CNX IT up by 0.56% and CNX Pharma up by 0.28% remained the gainers in the trade. While, India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 3.42% and reached 19.98.

The India VIX witnessed an addition of 3.42% at 19.98 as compared to its previous close of at 19.32 on Tuesday. The 50-share CNX Nifty lost 42.30 points or 0.72% to settle at 5,816.70.

Nifty July 2013 futures closed at 5822.05 on Wednesday at a premium of 5.35 points over spot closing of 5,816.70, while Nifty August 2013 futures ended at 5844.10 at a premium of 27.40 points over spot closing. Nifty July futures saw an addition of 0.07 million (mn) units taking the total outstanding open interest (OI) to 15.46 mn units. The near month July 2013 derivatives contract will expire on July 25, 2013.

From the most active contracts, RCOM July 2013 futures last traded at a discount of 0.30 points at 139.95 compared to spot closing of 140.25. The number of contracts traded was 15,723.

Tata Motors July 2013 futures last traded at a discount of 1.05 points at 283.5 compared with spot closing of 284.55. The number of contracts traded was 13,770.

Tata Steel July 2013 futures were at a discount of 6.75 points at 248.8 compared with spot closing of 255.55. The number of contracts traded was 11,367. 

Reliance Capital July 2013 futures were at a premium of 3.05 points at 377.55 compared with spot closing of 374.50. The number of contracts traded was 16,672. 

Reliance Industries July 2013 futures last traded at a discount of 0.30 points at 856.7 compared with spot closing of 857.00. The number of contracts traded was 37,931.

Among Nifty calls, 6,000 SP from the July month expiry was the most active call with an addition of 0.58 million open interest.

Among Nifty puts, 5,600 SP from the July month expiry was the most active put with contraction of 0.28 million open interest.

The maximum OI outstanding for Calls was at 6,000 SP (8.04 mn) and that for Puts was at 5,600 SP (8.08 mn).

The respective Support and Resistance levels of Nifty are: Resistance 5863.08 -- Pivot Point 5832.97 -- Support-- 5786.58.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.38 for July-month contract. The top five scrips with highest PCR on OI were Sesa Goa 2.53, Jubl Food 1.44, Kotak Bank 1.43, Ambuja Cement 1.38, and Ultra Cements -1.36.

Among most active underlying, Unitech witnessed an addition of 0.28 million of Open Interest in the July month futures contract followed by IFCI which witnessed a contraction of 1.56 million of Open Interest in the near month contract, Jaiprakash Associates witnessed contraction of 0.80 million in the July month futures. Also, Reliance Communication witnessed contraction of 0.69 million in Open Interest in the July month contract and Reliance Power witnessed contraction of 1.31 million of Open Interest in the near month futures contract.