Nifty ends marginally lower ahead of derivatives expiry

Nifty ended below 6,100 levels after a choppy session on Wednesday on the eve of the expiry of November derivative contracts and ahead of GDP and fiscal deficit data due on Friday. Nifty opened marginally higher in early deals as sentiments got some support from currency front where Indian rupee opened stronger on corporate dollar inflows. Meanwhile, Sugar stocks too remained jubilant as scrips like Balrampur Chini, Shree Renuka Sugar, Bajaj Hindusthan, Triveni Engineering etc edged higher on reports that the Food Ministry will soon seek Cabinet nod for providing interest-free loans to cash-starved sugar mills to help them meet working capital requirements. The gains on the up-side remained capped as global cues remained choppy with the US markets ending flat overnight. Moreover, Asian markets too were exhibiting mixed trend as investors remained cautious and indulged in some selling following a flat lead from Wall Street overnight. Volatility continued on street, index slipped in negative territory in late morning deals on account of selling witnessed in frontline blue chip stocks such as Bharti Airtel, BHEL, HDFC Bank, Sun Pharma and SBI as weak global cues weighed on the investors’ sentiments ahead of the November series expiry. Sentiments also remained dampened on report that foreign institutional investors (FIIs) sold shares worth a net Rs 339.16 crore on November 26, 2013, as per provisional data from the stock exchanges. 

Weakness continued on street in afternoon trade in absence of any buying activity. In last leg of trade, Nifty apparently started trimming losses on account of optimistic statement made by planning commission deputy chairman, Montek Singh Ahluwalia who underscored the economy to expand by over 6% next fiscal and Current Account Deficit to be significantly lower below 3% this fiscal. However, the index dipped in the final minutes of trade to close marginally below the neutral line.

NSE sectoral indices made a red closing; CNX IT down by 0.64%, CNX Infra down by 0.61%, CNX Realty down by 0.56%, CNX MNC by 0.42% and CNX Pharma down by 0.37% were the losers on index. On the other hand, CNX Auto up by 1.00%, CNX FMCG up by 0.76%, CNX Metal up by 0.39%, CNX Commodities up by 0.34% and CNX Consumption up by 0.11% were the gainers on index.

The India VIX increased by 2.08% at 21.14 as compared to its previous close of 21.59 on Tuesday. The 50-share CNX Nifty decreased by 2.00 points or 0.03% to settle at 6,057.10.

Nifty November 2013 futures closed at 6069.70 on Wednesday at a premium of 12.60 points over spot closing of 6,057.10, while Nifty December 2013 futures ended at 6116.25 at a premium of 59.15 points over spot closing. Nifty November futures saw contraction of 1.58 million (mn) units taking the total outstanding open interest (OI) to 8.56 mn units. The near month November 2013 derivatives contract will expire on November 28, 2013.

From the most active contracts, Tata Motors November 2013 futures last traded at a premium of 0.45 points at 399.70 compared with spot closing of 399.25. The number of contracts traded was 17,058.

ICICI Bank November 2013 futures were at a premium of 3.45 points at 1046.00 compared with spot closing of 1042.55. The number of contracts traded was 19,133. 

Reliance Industries November 2013 futures were at a premium of 1.80 points at 839.80 compared with spot closing of 838.00. The number of contracts traded was 18,108. 

SBI November 2013 futures were at a premium of 7.35 points at 1767.60 compared with spot closing of 1760.25. The number of contracts traded was 32,477. 

Axis Bank November 2013 futures were at a discount of 4.80 points at 1123.10 compared with spot closing of 1127.90. The number of contracts traded was 17,533.  Among Nifty calls, 6,200 SP from the November month expiry was the most active call with contraction of 0.16 million open interest.

Among Nifty puts, 6,000 SP from the November month expiry was the most active put with marginal in an addition in open interest.

The maximum OI outstanding for Calls was at 6,200 SP (6.30 mn) and that for Puts was at 6,000 SP (5.89mn).

The respective Support and Resistance levels of Nifty are: Resistance 6077.3-- Pivot Point 6053.8-- Support -- 6033.6.The Nifty Put Call Ratio (PCR) OI wise, stood at 0.90 for November month contract. The top five scrips with highest PCR on OI were, Tata Steel 1.66, Auro Pharma 1.35, Grasim 1.24,   L&T 1.24 and JSW Steel 1.17.

Among most active underlying, SBI witnessed contraction of 0.78 million of Open Interest in the November month futures contract followed by United Spirits with contraction of 1.66 million of Open Interest in the near month contract; Reliance Industries witnessed contraction of 1.51 million of Open Interest in the November month futures. ICICI Bank witnessed contraction of 1.59 million in Open Interest in the November month contract and TCS witnessed contraction of 1.00 million in Open Interest in the near month futures contract.