Nifty feels jitters on US Fed's taper decision

Nifty slipped into negative terrain after making a gap up opening in early deals tracking positive global cues. The US markets rose in last session even after the Federal Reserve announced plans to begin scaling back a monthly bond-buying program each month to $75 billion from $85 billion. Moreover, most of the Asian equity markets were trading in the green with Japanese market continuing its surge for the second consecutive day as the yen touched a five year-low against the dollar. Back home, bucking the positive trend seen in other Asian markets, the 50-share Nifty reclaimed its crucial level of 6,250 in morning trade turned negative and slipped below its support level of 6200 levels. Depreciation in rupee too weighed down on sentiments. Selling continued on street in late morning session with losses of close to 3/4th of a percent despite optimistic comments from Finance Minister, who underscored that government was committed to take all necessary steps to channelize greater investments and to achieve potential growth of the Indian economy.

Nevertheless, some more recovery was witnessed in early afternoon deals, with the positive start of European markets, which aided the selling pressure to virtually halt on the nifty. By the close of trade, Nifty, ended above the crucial 6,150 bastions. Meanwhile, broader indices although surrendered to profit-booking, but losses were limited to the extent of one tens of percent.

NSE sectoral indices made a green closing; CNX IT up by 1.79%, CNX Pharma up by 1.07%, CNX MNC up by 0.39%, CNX Media up by 0.28% and CNX Metal up by 0.18% were the gainers on index. On the other hand, CNX Finance down by 2.38%, CNX Bank down by 2.38%, CNX PSU Bank down by1.89%, CNX PSE down by 1.47% and CNX Infra down by 1.35% there were the loser on index.

The India VIX decreased by 5.47% at 16.58 as compared to its previous close of 17.54 on Tuesday. The 50-share CNX Nifty decreased by 50.50 points or 0.81% to settle at 6,166.65.

Nifty December 2013 futures closed at 6177.80 on Thursday at a premium of 11.15 points over spot closing of 6,166.65, while Nifty January 2014 futures ended at 6229.65 at a premium of 63.00 points over spot closing. Nifty December futures saw contraction of 3.06 million (mn) units taking the total outstanding open interest (OI) to 18.97 mn units. The near month December 2013 derivatives contract will expire on December 26, 2013.

From the most active contracts, Power Grid Corporation of India December 2013 futures traded at a premium of 0.65 points at 99.65 compared with spot closing of 99.00. The number of contracts traded was 82,737.

Reliance Industries December 2013 futures were at a premium of 3.35 points at 855.85 compared with spot closing of 852.50. The number of contracts traded was 23,018. 

Yes Bank December 2013 futures were at a premium of 0.75 points at 365.10 compared with spot closing of 364.35. The number of contracts traded was 17,415. 

ICICI Bank December 2013 futures were at a premium of 4.75 points at 1067.25 compared with spot closing of 1062.50. The number of contracts traded was 31,224. 

Ranbaxy Laboratories December 2013 futures were at a premium of 0.10 points at 451.80 compared with spot closing of 451.70. The number of contracts traded was 17,786. 

Among Nifty calls, 6,300 SP from the December month expiry was the most active call with an addition of 0.83 million open interest.

Among Nifty puts, 6,000 SP from the December month expiry was the most active put with an addition of 0.11 million open interest.

The maximum OI outstanding for Calls was at 6,300 SP (7.63 mn) and that for Puts was at 6,000 SP (5.79 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6236.7-- Pivot Point 6193.7- Support -- 6123.65.The Nifty Put Call Ratio (PCR) OI wise, stood at 1.02 for December month contract. The top five scrips with highest PCR on OI were Auro Pharma 2.11, Mcleodruss 2.09, Infosys 1.55, HCL Tech 1.34 and DR Reddy 1.33.

Among most active underlying, SBI witnessed contraction of 0.52 million in Open Interest in the December month futures contract followed by United Spirits witnessed contraction of 1.37 million of Open Interest in the December month contract; Reliance Industries witnessed contraction of 0.87 million of Open Interest in the December month futures. ICICI Bank witnessed contraction of 0.66 million of Open Interest in the December month contract and TCS witnessed an addition of 0.60 million in Open Interest in the near month futures contract.