Nifty closes marginally higher on back of buying in select blue-chip stocks

Nifty made negative start in early deals on Thursday tracking weak global cues. Overnight, US markets made a mixed closing amid a quiet day on the US economic data front and traders concentrated on earnings news. Asian markets too were trading mostly lower after activity in China’s factory sector contracted in January for the first time in six months, pointing to a weak start for the economy in 2014 as policymakers seek to curb high debt levels to head off financial risks. However, street  managed to pare some of their initial losses as in late morning some support came in with finance minister P Chidambaram’s assurance to global investors that India is prepared to face the impact of the US Fed tapering and the country is poised to clock 5% growth in 2013-14 and over 6% in 2014-15. Sentiments also remained up-beat with a Moody’s Analytics report that the Indian economy has started to turn the corner and the worst may be over for the Indian economy. It further said that a Narendra Modi-led BJP government, if elected, should offer a more business-friendly policy that will further support confidence and investment.

Further, gradual buying was witnessed during noon trades mainly on the back of up-move of select blue-chip stocks which lifted the index marginally higher. Good Q3 showing by Index heavyweight L&T provided the support. L&T puffed up gains of over 2.5% after reporting a robust operating performance in the December quarter with all-round growth, after adjusting for the de-merger of its hydrocarbons business. In last leg of trade, index ended higher for yet another session, albeit with modest gains of over one tenths of a percent, just short of the crucial 6,350 levels.

Most of the NSE sectoral indices made a green closing; CNX Infra up by 1.00%, CNX Finance up by 0.37%, CNX Pharma up by 0.33%, CNX FMCG up by 0.23% and CNX Service up by 0.14% were the gainer on index. On the other hand, CNX Auto down by 1.03%, CNX Energy down by 0.54%, CNX Metal down by 0.45%, CNX PSE down by 0.38% and CNX Media down by 0.32% were the top losers on index.

The India VIX decreased by 1.70% at 15.58 as compared to its previous close of 15.85 on Tuesday. The 50-share CNX Nifty increased by 6.70 points or 0.11% to settle at 6,345.65.

Nifty January 2014 futures closed at 6357.80 on Thursday at a premium of 12.15 points over spot closing of 6,345.65, while Nifty February 2014 futures ended at 6392.95 at a premium of 47.30 points over spot closing. Nifty January futures saw contraction of 0.34 million (mn) units taking the total outstanding open interest (OI) to 17.17 mn units. The near month January 2014 derivatives contract will expire on January 30, 2014.

From the most active contracts, Reliance Communications January 2014 futures were at a premium of 0.40 points at 134.15 compared with spot closing of 133.75. The number of contracts traded was 9,629.  

Reliance Industries January 2014 futures were at a premium of 2.95 points at 868.95 compared with spot closing of 866.00. The number of contracts traded was 11,436. 

ICICI Bank January 2014 futures were at a premium of 5.25 points at 1081.35 compared with spot closing of 1076.10. The number of contracts traded was 13,800. 

SBI January 2014 futures traded at a discount of 1.20 points at 1658.35 compared with spot closing of 1659.55. The number of contracts traded was 27,935.

L&T January 2014 futures traded at a premium of 2.95 points at 1034.45 compared with spot closing of 1031.50. The number of contracts traded was 19,164.Among Nifty calls, 6,500 SP from the January month expiry was the most active call with an addition of 0.37 million in open interest.

Among Nifty puts, 6,300 SP from the January month expiry was the most active put with  an addition of 0.67 million open interests.

The maximum OI outstanding for Calls was at 6,500 SP (5.45 mn) and that for Puts was at 6,300 SP (6.96 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6362.03 -- Pivot Point 6339.22 – Support- 6322.83.

The Nifty Put Call Ratio (PCR) OI wise, stood at 1.26 for January month contract. The top five scrips with highest PCR on OI were DR Reddy 2.99, Infosys 2.27, HDFC 1.95, Auro Pharma 1.83 and HCL Tech 1.79.

Among most active underlying, SBI witnessed contraction of 0.27 million of Open Interest in the January month futures contract followed by Infosys witnessed contraction of 0.12 million of Open Interest in the January month contract; Reliance Industries witnessed contraction of 0.04 million of Open Interest in the January month futures. United Spirits witnessed contraction of 0.40 million of Open Interest in the January month contract and TCS witnessed contraction of 0.13 million in Open Interest in the near month futures contract.