Nifty closes strongly above 6,200 levels on F&O expiry

Nifty increased for the fourth consecutive day on Buying by investors to cover their pending positions on settlement in the derivatives segment helped the barometer close above 6,200 level. After a steady opening, index continued their northward journey once again showcased an enthusiastic performance without iota of profit booking and concluded near day’s high point. On the global front, Asian pacific shares ended mostly lower as concerns over opaque policy moves in China kept investors on edge amid a drought of major economic data. Additionally, European shares edged lower on Wednesday, weighed by weakness in Credit Suisse that helped stall the advance of a leading regional index to a fresh near 6-year high.

Back home, Market participants’ sentiments remained boost as foreign institutional investors (FIIs) bought shares worth a net Rs 423.41 crore on February 25, 2014, as per provisional data from the stock exchanges. Stocks related to NBFC counter remained on buyers’ radar as the Reserve Bank of India moved closer to granting new banking licences as a panel headed by former RBI governor Bimal Jalan finalized a list of firms for the central bank to consider. Buying in IT and healthcare counters too aided the sentiments as PricewaterhouseCoopers (PwC) report on Private Equity (PE) investment in India highlighted that IT, ITeS and pharmaceuticals will continue to attract high PE investments given their strong export focus, particularly against a depreciating rupee.

However, Metal counter continued witnessing selling tailing the weakness in the Chinese market where the currency tumbled the most in more than a year on speculation the central bank wants an end to the currency’s steady appreciation. Meanwhile, fertilizer stocks ended mixed ahead of CCEA meet on Friday. The Cabinet Committee on Economic Affairs (CCEA) in its meeting is expected to consider increasing the fixed cost for urea plants and amend the new investment policy (NIP 2012) soon. The proposal to increase fixed cost although would not entail any increase in the retail prices of urea. However, this would increase government’s subsidy burden by around Rs 900 crore.

Meanwhile, sectoral indices on the NSE made positive closing. CNX Metal down by 1.64%, CNX Commodities down by 0.50% and CNX Realty down by 0.39% were remained the top losers in the trade. While,  CNX FMCG up by 1.07%, CNX Pharma up by 1.04%, CNX Auto up by 0.94%, CNX Finance up by 0.68% and CNX Bank up by 0.60% remained the gainers in the trade.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 0.03% and reached 13.9550. The 50-share CNX Nifty increased by 38.75 points or 0.62% to settle at 6,238.80.

Nifty March 2014 futures closed at 6272.75 on Wednesday at a premium of 33.95 points over spot closing of 6,238.80, while Nifty April 2014 futures ended at 6309.30 at a premium of 70.50 points over spot closing. Nifty March futures saw an addition of 4.48 million (mn) units, taking the total outstanding open interest (OI) to 13.60 mn units. The near month March 2014 derivatives contract will expire on March 27, 2014.

From the most active contracts, Reliance Industries March 2014 futures traded at a premium of 4.95 points at 816.95 compared with spot closing of 812.00. The number of contracts traded was 32,628.

SBI March 2014 futures were at a discount of 3.25 points at 1518.55 compared with spot closing of 1521.80. The number of contracts traded was 37,841.

United Spirits March 2014 futures were at a premium of 8.05 points at 2384.05 compared with spot closing of 2376.00. The number of contracts traded was 22,922.

TCS March 2014 futures were at a premium of 16.20 points at 2200.15 compared with spot closing of 2183.95. The number of contracts traded was 22,774.  . 

Among Nifty calls, 6,300 SP from the March month expiry was the most active call with addition of 0.50 million open interest.

Among Nifty puts, 6,100 SP from the March month expiry was the most active put with an addition of 1.02 million open interests.

The maximum OI outstanding for Calls was at 6,300 SP (34.93 mn) and that for Puts was at 6,100 SP( 4.00 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6255.8-- Pivot Point 6228.95 - Support- 6211.95.

The Nifty Put Call Ratio (PCR) OI wise, finally stood at 1.12 for March month contract. The top five scrips with highest PCR on OI were Kotak Bank 2.32, Cairn 1.94, Asian Paint 1.55, Bata India 1.29, and Jubl Food 1.20.

Among most active underlying, State Bank of India witnessed contraction of 1.52 million of Open Interest in the March month futures contract, followed by Reliance Industries witnessing contraction of 4.18 million of Open Interest in the March month contract; United Spirits witnessed contraction of 1.70 million of Open Interest in the March month futures. TCS witnessed an addition of 1.29 million of Open Interest in the March month contract and ICICI Bank witnessed contraction of 1.85 million in Open Interest in the expiring March month’s future contract.