Trading sentiments continued to remain bearish on Monday as S&P CNX Nifty snapped the trade in the red breaching its crucial 5,150 mark on the back of disappointing second quarter numbers reported by some companies while fall in European markets too dampened the sentiments. However, market made a gap-up start on firm global cues but, the sentiments turned bearish in final hour of trade as European market turned choppy after a good start. Moreover, headline inflation hovered persistently near the double-digit mark in October, rising marginally to 9.73% as prices of food products, fuel and manufactured goods put more pressure on the common man's pocket and major sectors of the economy. Local index made a gap-up opening as positive economic news lifted global sentiments after Italian Senate backed austerity package. Market recaptured its crucial 5,200 mark in initial trade as sentiment remained firm after Japanese GDP grew for the first time in four quarters since the massive earthquake in March. Afterwards, the index traded range-bound till early noon trade despite reporting disappointing inflation numbers. India’s headline inflation measured by Wholesale Price Index (WPI) for the month of October saw marginally increasing to 9.73% as compared to 9.72% in September; the headline inflation has been out riding above 9.7% mark since last three weeks. But, in the mid noon trade market started its southward journey following some weak earning posted by companies like, Mahindra and Mahindra (M&M), Reliance Communications and Coal India. M&M decreased marginally by 2.7% during the quarter ended September 2011. Its net profit dipped to Rs 737 crore from Rs 758 crore during the corresponding quarter a year ago. Moreover, PSU oil marketing companies viz. BPCL, HPCL and IOC declined by 1-2 percent as crude oil boils. Benchmark crude for December delivery gained $0.11, or 0.12% to $99.10 a barrel on the New York Mercantile Exchange. In the final hour of trade market turned negative as European markets reversed their all gains and were trading in the red. Finally, Nifty ended the trade with a cut of about half a percent near its intraday low breaching its psychological 5,150 mark.
Globally, US markets rose Friday on growing optimism over Europe's debt problems, with the Dow Jones Industrial Average closing 2.18% higher while, all the Asian equity indices ended higher on Monday as investors welcomed leadership change in Greece and Italy while also cheering news that Japan’s economy grew for the first time in a year. Moreover, the European counterparts were trading mostly in the red at this point of time. Back home, most of the sectoral indices on the NSE settled in the negative territory with CNX Realty losing the most, ending with a cut of about three percent followed by CNX Metal down by 2.25% and CNX Auto down by 2.10% while, CNX Pharma and CNX IT up by 0.78% and 0.67% in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, surged 2.22% and reached 25.29.
The 50-share S&P CNX Nifty lost 20.50 points or 0.40% and settled at 5,148.35.
Nifty November 2011 futures closed at 5,150.00 at a premium of 1.65 points over spot closing of 5,148.35, while Nifty December 2011 futures were at 5,177.80 at a premium of 29.45 points over spot closing. The near month November 2011 derivatives contract expires on Thursday, November 24, 2011. Nifty November futures saw addition of 1.58 million (mn) units taking the total outstanding open interest (OI) to 28.28 mn units.
From the most active contract by contract value, SBI’s November 2011 futures were at a premium of 4.50 point at 1746.50 compared with spot closing of 1742.00. The number of contracts traded was 35,352.
M&M November 2011 futures were at a discount of 0.80 point at 790.10 compared with spot closing of 790.90. The number of contracts traded was 14,775.
Tata Motors November 2011 futures were flat at 176.60 compared with spot closing of 176.60. The number of contracts traded was 19,458.
RIL November 2011 futures were at a premium of 2.00 point at 876.00 compared with spot closing of 874.00. The number of contracts traded was 18,392.
Tata Steel November 2011 futures were at a discount of 1.00 point at 412.45 compared with spot closing of 413.45. The number of contracts traded was 19,340.
Among Nifty calls, 5200 SP from the November month expiry was the most active call with an addition of 0.57 million or 12.96%.
Among Nifty puts, 5200 SP from the November month expiry was the most active put with a contraction of 0.44 million or 11.12%.
The maximum Call OI outstanding for Calls was at 5200 SP (5.00mn) and that for Puts was at 5200 SP (4.44mn).
The respective Support and Resistance levels are: Resistance 5204.65-- Pivot Point 5172.6-- Support 5116.3.
The Nifty Put Call Ratio (PCR) OI wise stood at 1.26 for November-month contract.
The top five scrips with highest PCR on OI were kotak Bank 4.67, Syndicate Bank 3.22, Siemens 2.33, Dr Reddy’s Lab 1.97, BF Utilities 1.67.
Among most active underlying, SBI witnessed an addition of 4.00% of Open Interest (OI) in the November month futures contract followed by Tata Steel witnessed an addition of 7.31% Open Interest (OI) in the near month contract. Meanwhile Tata Motors witnessed an addition of 2.06% of OI in the November month futures. Also, Reliance witnessed an addition of 3.08% of Open Interest (OI) in the November month contract followed by Shree Renuka Sugars witnessed an addition of 27.60% of Open Interest (OI) in the November month contract.
