Amid bloodbath, Nifty ends lower on weak rupee

Nifty plunged 2.5% lower on Tuesday from its previous close, amid a weakening rupee and on concerns that the RBI would announce fresh liquidity tightening measures to prevent further weakness in the rupee. The rupee hit an all time low today on fresh dollar demand from banks and importers. The rupee slumped down 42 paise at Rs 61.80. The recent measures by the RBI  were said to be enough to contain the falling rupee but the plunge in the rupee has only indicated the inefficiency in providing satisfactory measures. Meanwhile, the finance ministry and the Reserve Bank of India (RBI) will discuss possible measures to manage the situation. The sub-committee of Financial Stability Development Council (FSDC) will meet in Mumbai tomorrow to assess the impact of liquidity tightening steps taken by the central bank in the last few weeks.

Meanwhile, sentiments across the globe remained down-beat on speculation that the Federal Reserve may soon reduce economic stimulus after US economy showed signs of recovery. Overnight, the US markets ended mostly lower, though there was a report that activity in the US service sector grew at a faster rate in the month of July. Asian markets too ended mostly in the red with Hang Seng shedding over a percent on the back of disappointing first-half earnings from HSBC. However, European markets traded mixed in early deals.

Pressurized by feeble global cues, index made a gap-down opening and hit fresh intraday low in the late morning trade along with the steep slide in rupee which took it to record low against the dollar, rattled investor sentiment. Weakness continued on the index in mid-afternoon trade. In last leg of trade the index hit its 16-week lowest level.

Meanwhile, sectoral indices on the NSE made red closing. CNX Realty down 4.61%, CNX Finance down 4.12%, CNX Media down 3.95%, CNX Bank down 3.88% and CNX Commodities down 3.29% remained the top losers in the trade. While, there was no gainers in the trade .The India VIX witnessed an addition 9.27% at 22.73 as compared to its previous close of 20.80 on Monday. The 50-share CNX Nifty lost 143.15 points or 2.52 % to settle at 5,542.25.

Nifty August 2013 futures closed at 5573.35 on Tuesday at a premium of 31.10 points over spot closing of 5,542.25, while Nifty September 2013 futures ended at 5603.25 at a premium of 61.00 points over spot closing. Nifty August futures saw an addition of 1.45 million (mn) units taking the total outstanding open interest (OI) to 16.69 mn units. The near month August 2013 derivatives contract will expire on August 29, 2013.

From the most active contracts, BHEL August 2013 futures last traded at a premium of 0.95 points at 113.20 compared with spot closing of 112.25. The number of contracts traded was 17,450.

DLF August 2013 futures were at a premium of 0.25 points at 122.95 compared with spot closing of 122.70. The number of contracts traded was 23,521. 

Tata Motors August 2013 futures last traded at a premium of 2.05 points at 289.05 compared with spot closing of 287.00. The number of contracts traded was 12,991.

Yes Bank August 2013 futures were at a premium of 5.50 points at 277.00 compared with spot closing of 271.50. The number of contracts traded was 23,738. 

ICICI Bank August 2013 futures last traded at a premium of 8.15 points at 872.05 compared with spot closing of 863.90. The number of contracts traded was 17,224. Among Nifty calls, 6,000 SP from the Aug month expiry was the most active call with contraction of 0.68 million open interest.

Among Nifty puts, 5,400 SP from the Aug month expiry was the most active put with an addition of 0.90 million open interest.

The maximum OI outstanding for Calls was at 6,000 SP (6.38 mn) and that for Puts was at 5,400 SP (5.63mn).

The respective Support and Resistance levels of Nifty are: Resistance 5630.83 -- Pivot Point 5576.32- Support -- 5487.73.

The Nifty Put Call Ratio (PCR) OI wise stood at 0.95 for August month contract. The top five scrips with highest PCR on OI were Federal Bank 2.67, Hind Zinc 2.00, Power Grid 1.63, Mcleodruss 1.33 and Bharat Forg 1.33.

Among most active underlying, JP Associates witnessed contraction of 0.87 million of Open Interest in the Aug month futures contract followed by Unitech which witnessed an addition  of 0.78 million of Open Interest in the near month contract; Reliance Communications witnessed contraction  of 1.25 million in the Aug month futures. Also, BHEL witnessed an addition of 2.96 million in Open Interest in the Aug month contract and DLF witnessed an addition of 1.80 million of Open Interest in the near month futures contract.