Nifty ends below 6,000 levels amid selling pressure in private banks

Nifty closed below 6,000 levels amid a volatile trading session on Wednesday because of selling pressure in private banks. Nifty regained positive terrain after opening lower in early trades as investors turned cautious on signs that the US Fed may start winding down its quantitative easing. Gains on the up-side remained capped as consumer price inflation quickened to 10.09 percent in October from 9.84 percent in September and the IIP for September grew by a meagre 2%.

Volatility continued on street as Index recovered, after hitting its lowest level in nearly five weeks and alternately hovered between gains and losses in late morning deals, on the back of gains in some selected heavyweights. Sentiments got some support as the Rupee managed to regain some lost ground and was quoting at 63.71 to a Dollar. In the opening deals, the Indian currency had lost 17 paise to trade at a fresh two-month low of 63.88 on strong dollar demand from importers amid weak local equities. 

Final hours of trade were mere repetition of what has been going for the last six days as the benchmark encountered heavy selling at the highest points of the day, which took the markets once again in the red terrain. Investors got worried that the Reserve Bank of India (RBI) may further hike policy rates in its next policy meet after the latest data showed consumer price inflation has quickened in October.

NSE sectoral indices made a red closing; CNX Realty down by 1.30%, CNX FMCG down by 1.10%, CNX Infra down by 0.63%, CNX IT down by 0.62% and CNX Media down  by 0.62%. On the other hand, CNX PSU Bank up by 0.59%, CNX Auto up by 0.47%, CNX Metal up by 0.18% and CNX PSE up by 0.09% were the gainers on index.

The India VIX decreased by 1.96% at 20.45 as compared to its previous close of 20.86 on Tuesday. The 50-share CNX Nifty decreased by 28.45 points or 0.47% to settle at 5,989.60.

Nifty November 2013 futures closed at 6033.00 on Wednesday at a premium of 43.40 points over spot closing of 5989.60, while Nifty December 2013 futures ended at 6085.05 at a premium of 95.45 points over spot closing. Nifty November futures saw contraction of 0.63 million (mn) units taking the total outstanding open interest (OI) to 18.92 mn units. The near month November 2013 derivatives contract will expire on November 28, 2013.

From the most active contracts, Reliance Communications November 2013 futures last traded at a discount of 0.45 points at 132.85 compared with spot closing of 133.30. The number of contracts traded was 23,807.

Tata Steel November 2013 futures were at a discount of 1.50 points at 361.60 compared with spot closing of 363.10. The number of contracts traded was 21,657. 

Yes Bank November 2013 futures were at a premium of 1.30 points at 334.50 compared with spot closing of 333.20. The number of contracts traded was 19,095. 

HDFC Bank November 2013 futures were at a premium of 7.05 points at 639.00 compared with spot closing of 631.95. The number of contracts traded was 13,648. 

Reliance Industries November 2013 futures were at a premium of 8.60 points at 851.65 compared with spot closing of 843.05. The number of contracts traded was 13,393. 

Among Nifty calls, 6,300 SP from the November month expiry was the most active call with contraction of 0.01 million open interest.

Among Nifty puts, 6,000 SP from the November month expiry was the most active put with contraction of 0.37 million open interest.

The maximum OI outstanding for Calls was at 6,300 SP (5.89 mn) and that for Puts was at 6,000 SP (4.92 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6030.42-- Pivot Point 6001.43-- Support -- 5960.62. The Nifty Put Call Ratio (PCR) OI wise, stood at 1.12 for November month contract. The top five scrips with highest PCR on OI were, Grasim 2.07, Divislab 1.57, Infosys 1.32, Auro Pharma 1.25and Glenmark 1.17.

Among most active underlying, SBI witnessed contraction of 0.12 million of Open Interest in the November month futures contract followed by United Spirits with an addition of 0.08 million of Open Interest in the near month contract; Reliance Industries witnessed an addition of 0.26 million of Open Interest in the November month futures. ICICI Bank witnessed an addition of 0.57 million in Open Interest in the November month contract and TCS witnessed addition of 0.01 million in Open Interest in the near month futures contract.