Nifty closes higher on good WPI data

Nifty rose for the third consecutive session on Monday above its one and half month high as sentiments were optimistic about the upcoming results, while the wholesale inflation data came in line with market expectations, boosted buying in blue chips stocks. The better than expected June WPI inflation, which came at 4.86 per cent, a tad higher than 4.7 per cent and lower than the estimated 5 per cent helped the index to break out of narrow the intraday range. Sentiments got some support from the firming trend in the Asian region. Investor sentiments were bolstered as IT sector surged on back of good results from the IT major Infosys.

Global cues too remained supportive, as European counterparts made a positive opening after political parties in Portugal decided on a deadline for bailout reforms. Asian markets too rallied after the China’s second-quarter growth data met street expectations. The world’s second-largest economy expanded 7.5 per cent in the second quarter. Moreover, the US markets remained in positive terrain on Friday taking cues from some better than expected earnings, though the gains were modest as the economic reports were not that encouraging.

Nifty started in the red on disappointing IIP and CPI data that was released after the market hours on Friday. Index of industrial production (IIP) for May fell by 1.6 per cent, versus the growth of 2.3 per cent in April, while consumer price index (CPI) inched up to 9.87 per cent in June, against 9.31 per cent in May and continued to move in a narrow range in mid-morning trade. But, the indices reversed direction and moved into positive terrain in afternoon trade after European markets opened higher and country’s headline inflation eased for the month of June and remained within the Reserve Bank of India’s comfort zone of sub-5 per cent. The Wholesale Price Index-based inflation rose to 4.86% (Provisional) in June, compared to 4.7% (Provisional) during the previous month.

Meanwhile, sectoral indices on the NSE made a positive closing. CNX Realty up by 2.20%, CNX PSU Bank up by 1.96%, CNX Consumption up by 1.29%, CNX MNC up by 1.25% and CNX FMCG up by 1.08% remained the top gainers in the trade. While, CNX PSE down by 0.56%, CNX IT down by 0.33%, CNX Commodities 0.01% and CNX Metal 0.01% were the loser in the trade.

The India VIX witnessed an addition of 0.54% at 18.79 as compared to its previous close of 18.69 on Friday. The 50-share CNX Nifty gained 21.80 points or 0.36% to settle at 6,030.80.

Nifty July 2013 futures closed at 6032.60 on Monday at a premium of 1.80 points over spot closing of 6,030.80, while Nifty August 2013 futures ended at 6057.20 at a premium of 26.40 points over spot closing. Nifty July futures saw an addition of 0.32 million (mn) units taking the total outstanding open interest (OI) to 17.98 mn units. The near month July 2013 derivatives contract will expire on July 25, 2013.

From the most active contracts, JP Associates July 2013 futures last traded at a discount of 0.15 points at 54.30 compared with spot closing of 54.45. The number of contracts traded was 10,808.

Reliance Communications July 2013 futures last traded at a premium of 0.65 points at 146.55 compared with spot closing of 145.90. The number of contracts traded was 10,452.

Tata Steel July 2013 futures were at a premium of 1.30 points at 258.35 compared with spot closing of 257.05. The number of contracts traded was 13,020. 

DLF July 2013 futures were at a premium of 1.15 points at 179.10 compared with spot closing of 177.95. The number of contracts traded was 15,368. 

Reliance Capital July 2013 futures last traded at a premium of 1.90 points at 387.90 compared with spot closing of 386.00. The number of contracts traded was 11,533.

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

Among Nifty puts, 5,800 SP from the July month expiry was the most active put with an addition of 0.04 million open interest.

The maximum OI outstanding for Calls was at 6,000 SP (5.94 mn) and that for Puts was at 5,600 SP (8.27 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6052.35 -- Pivot Point 6016.65 -- Support-- 5995.1.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.75 for July-month contract. The top five scrips with highest PCR on OI were Sesa Goa 2.48, DR reddy 1.83, HUL 1.53, Ambuja Cement 1.41and Sun Pharma 1.39.

Among most active underlying, Unitech witnessed an addition of 0.47 million of Open Interest in the July month futures contract followed by Jaiprakash Associates which witnessed an addition of 1.30 million of Open Interest in the near month contract, IFCI witnessed contraction of 1.20 million in the July month futures. Also, Reliance Communication witnessed an addition of 0.76 million in Open Interest in the July month contract and Reliance Power witnessed contraction of 0.50 million of Open Interest in the near month futures contract.