Weak IIP data and global cues drag Nifty below 5,500 mark

The fifty stock index -- Nifty -- continued its southbound journey on the last trading day of the week and ended the choppy day of trade below its crucial 5,500 level with a cut of over half a percent on getting weak Index of Industrial Production (IIP) data in April while. Weak cues across the globe too dampened the sentiments. Earlier, the Indian equity markets made flat start tracking mixed cues from global indices. Thereafter, sentiment turned bearish as sustained selling witnessed by funds and retail investors ahead of the release of IIP data. Once the IIP numbers  were released the condition went worst and the index drifted further  low in the session as factory output figures came lower than expected. The new series of Index of Industrial Production (IIP) with an updated base of 2004-05 starting from the month of April, registered growth at 6.3% against 7.3% in March. Meanwhile, under the old series, annual industrial output growth in April was much lower at 4.4% compared with a median forecast for 5.5%. Moreover, PSU oil marketing companies BPCL, HPCL and IOC all ended the day’s trade with a cut in the range of 1-2 percent as the international crude oil prices rose further. Benchmark touched its intraday low in the mid afternoon trade but, it got strong support near that level and started moving upward and pared loss of about 30 points and snapped the trade with a cut of over half a percent.

On the global front, the US markets made a modest bounce back overnight on report that American trade deficit shrank unexpectedly in April after the United States sold $175.6 billion in goods and services overseas. Most of the Asian equity indices finished the day’s trade in the negative terrain on the last trading day of the week. Moreover, all the European counterparts were trading mixed at this point of time. Back home, on the sectoral front, all the indices on NSE declined, CNX Infra remained the major laggard, losing 1.03% followed by CNX Realty down 0.96%, Bank Nifty slipped 0.66% and CNX IT dipped by 0.09%. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, declined 0.21% and reached 18.54, while S&P Nifty closed at 5,485.80 losing 35.25 points or 0.64%.

The India VIX witnessed a contraction of 0.21% at 18.54 on Friday as compared to its previous close of 18.58 on Thursday.  

The 50-share S&P CNX Nifty declined 35.25 points or 0.64% and settled at 5,485.80.

Nifty June 2011 futures closed at 5,485.65, at a discount of 0.15 points over spot closing of 5,485.80, while Nifty July 2011 futures were at 5,501.90 at a premium of 16.10 points over spot closing. The near month June 2011 derivatives contract expires on Thursday, June 30, 2011.

Nifty June futures saw addition of 3.86% or 0.93 million (mn) units, taking the total outstanding open interest (OI) to 25.27 mn units.

From the most active underlying, SBI’s June 2011 futures closed at a premium of 8.85 points at 2250.95 compared with spot closing of 2242.10. The number of contracts traded was 21,259.

Tata Motors June 2011 futures were at a premium of 3.10 point at 1020.10 compared with spot closing of 1017.00. The number of contracts traded was 14,473.

Titan June 2011 futures were at a discount of 36.50 points at 4543.50 compared with spot closing of 4580.00. The number of contracts traded was 6,524.

RIL June 2011 futures were at a discount of 1.00 at 945.00 compared with spot closing of 946.00. The number of contracts traded was 15,121.

ICICI Bank June 2011 futures were at a premium of 3.40 points at 1037.90 compared with spot closing of 1034.50. The number of contracts traded was 13,434.

Among Nifty calls, 5500 SP from the June month expiry was the most active call with an addition of 1.57 million or 36.04%.

Among Nifty puts, 5500 SP from the June month expiry was the most active put with contraction of 1.12  million or 16.57%.

The maximum Call OI outstanding for Calls was at 5500 SP (5.91 mn) and that for Puts was at 5500 SP (5.65mn).

The respective Support and Resistance levels are: Resistance 5519.01-- Pivot Point 5488.23-- Support 5455.01.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.21 for June -month contract.

The top five scrips with highest PCR on OI were Videocon Industries - 10.00, Sintex- 3.00, BEML- 3.00, Bharat Forge- 2.00, Asian Paints-  1.75.

Among most active underlying, State Bank of India (SBI) witnessed an addition of 1.92% of Open Interest (OI) in the June month futures contract followed by Tata Motors which too added 0.22% of Open Interest (OI) in the near month contract. Meanwhile Reliance Industries witnessed an addition of 1.70% of OI in the June month futures and, L&T witnessed contraction of 0.71% of Open Interest (OI) in the June month futures contract.