Nifty closes below 6250 levels ahead of IIP, inflation data

Prolonging southward journey for third consecutive day, Nifty made a sluggish start on Thursday amid weak global cues. The US markets ended lower in the last session on Fed tapering concerns after lawmakers agreed on a way out of a budget impasse. Moreover, all the Asian equity markets were trading in the red at this point of time amid expectations the Federal Reserve may act sooner than later to unwind its stimulus after a provisional budget deal in Washington eased some of the fiscal drag on the US economy. Relentless selling continued on street in late morning as the rupee was trading lower at 61.65. Meanwhile, investors also remained concerned with Standard & Poor’s (S&P) statement that India’s sovereign rating could come under threat if the general election due next year threw up a hung Parliament or the government was unable to push through reforms. Also, India’s export growth slipped to a five-month low of 5.86 percent in November as shipments of petro-goods, pharma, automobile and gems and jewellery fell.

Blood bath prevailed on street in noon trades in absence of any positive catalyst amidst prevailing caution ahead of October IIP, November CPI data, which could provide cues on RBI’s stance in its upcoming monetary policy meet in the coming week. On the macro-front, the IIP is estimated to fall to 1.2% from 2% in the previous month, while CPI is expected still be in double digits, at 10%. Besides, negative regional counterparts also are underpinning investors to cash out their profits. In last leg of trade, index concluded near day’s lowest point, after witnessing a cut of over a percent, settled below the crucial 6,250 levels. Meanwhile, broader indices too witnessing profit-booking, concluded with losses, albeit slender. In the last half an hour of trade, Nifty bled further and closed below 6,250 levels on the back of weak global markets and ahead of the IIP and CPI data.

NSE sectoral indices made a red closing; CNX Auto down by 2.13%, CNX Metal down by 1.36%, CNX PSE by 1.28%, CNX Bank by 1.26% and CNX PSU Bank by 1.20% were the top losers on index. On the other hand, there was no gainer on index.

The India VIX increased by 1.14% at 17.74 as compared to its previous close of 17.54 on wednesday. The 50-share CNX Nifty decreased by 70.85 points or 1.12% to settle at 6,237.05.

Nifty December 2013 futures closed at 6264.95 on Thursday at a premium of 27.90 points over spot closing of 6,237.05, while Nifty January 2014 futures ended at 6319.45 at a premium of 82.40 points over spot closing. Nifty December futures saw an addition of 0.20 million (mn) units taking the total outstanding open interest (OI) to 22.24 mn units. The near month December 2013 derivatives contract will expire on December 26, 2013.

From the most active contracts, JP Associates December 2013 futures last traded at a premium of 0.45 points at 54.55 compared with spot closing of 54.10. The number of contracts traded was 11,247.

DLF December 2013 futures were at a premium of 0.70 points at 156.45 compared with spot closing of 155.75. The number of contracts traded was 11,255. 

Tata Motors December 2013 futures were at a premium of 2.80 points at 362.90 compared with spot closing of 360.10. The number of contracts traded was 22,741. 

Reliance Industries December 2013 futures were at a premium of 3.80 points at 874.10 compared with spot closing of 870.30. The number of contracts traded was 12,022. 

Yes Bank December 2013 futures were at a premium of 2.60 points at 381.50 compared with spot closing of 378.90. The number of contracts traded was 11,871. 

Among Nifty calls, 6,300 SP from the December month expiry was the most active call with an addition of 1.15 million open interest.

Among Nifty puts, 6,000 SP from the December month expiry was the most active put with an addition   of 0.15 million in open interest.

The maximum OI outstanding for Calls was at 6,300 SP (5.43 mn) and that for Puts was at 6,000 SP (5.04 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6272.42-- Pivot Point 6251.48- Support -- 6216.12.The Nifty Put Call Ratio (PCR) OI wise, stood at 1.11 for December month contract. The top five scrips with highest PCR on OI were, Mcleodruss 1.69, Tata Steel 1.21, DR Reddy 1.16, Maruti 1.13 and Axis Bank 0.98.

Among most active underlying, Power Grid Corporation of India witnessed an addition of 2.48 million  in Open Interest in the December month futures contract followed by United Spirits  with marginal  an addition in Open Interest in the near month contract; SBI witnessed  contraction of 0.02 million of Open Interest in the December month futures. Reliance Industries witnessed contraction in Open Interest in the December month contract and TCS witnessed an addition of 0.04 million in Open Interest in the near month futures contract.