Amid slight volatility Nifty consolidates; closes flat with minor gains

After nearly one and half percent rally to scale all-time closing high in the previous session, Tuesday’s session turned out to be a consolidating one with the Nifty capturing minor gains in its favour until the close. The session witnessed some volatility amid a stirring tussle between bulls and bears in which the index very slightly extended its all time high level as investors betted on good outlook post the general elections.

Selling in heavyweights like RIL, ONGC and Oil India in early morning dampened sentiments after the Election Commission asked the government to defer hiking natural gas prices until the polls are concluded. However, losses on the down side remained capped as sentiments got support after Economic Affairs Secretary Arvind Mayaram stated that the Finance Ministry expects economic growth to further improve in the next fiscal on the back of better macro-economic fundamentals. Further, Capital inflows by foreign funds and appreciating rupee steadied the index.

Meanwhile, sectoral indices on the NSE made positive closing. CNX Realty up by 1.36%, CNX Infra up by 1.38%, CNX PSU Bank up by 0.72%, CNX MNC up by 0.68% and CNX Finance up by 0.67% remained the gainers in the trade. While, CNX Energy down by 0.97%, CNX IT down by 0.69% and CNX Media down by 0.14% were remained the top losers in the trade.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, up by 2.31% and reached 16.9200. The 50-share CNX Nifty increased by 6.25 points or 0.09% to settle at 6,589.75

Nifty March 2014 futures closed at 6,605.95 on Tuesday at a premium of 16.20 points over spot closing of 6,589.75, while Nifty April 2014 futures ended at 6660.90 at a premium of 71.15 points over spot closing. Nifty March futures saw contraction of 1.82 million (mn) units, taking the total outstanding open interest (OI) to 18.71 mn units. The near month March 2014 derivatives contract will expire on March 27, 2014.

From the most active contracts, BHEL March 2014 futures traded at a discount of 0.55 points at 195.45 compared with spot closing of 196.00. The number of contracts traded was 19,437.

HDFC Bank March 2014 futures were at a premium of 3.45 points at 754.20 compared with spot closing of 750.75. The number of contracts traded was 23,543.

Tata Steel March 2014 futures were at a premium of 1.70 points at 368.20 compared with spot closing of 366.50. The number of contracts traded was 20,551.

Reliance Industries March 2014 futures traded at a premium of 3.50 points at 881.30 compared with spot closing of 877.80. The number of contracts traded was 35,129.

ICICI Bank March 2014 futures traded at a premium of 2.15 points at 1255.15 compared with spot closing of 1253.00. The number of contracts traded was 26,033.   Among Nifty calls, 6,600 SP from the March month expiry was the most active call with an addition of 0.36 million open interest.

Among Nifty puts, 6,400 SP from the March month expiry was the most active put with  contraction of 0.70 million open interest.

The maximum OI outstanding for Calls was at 6,600 SP (6.11 mn) and that for Puts was at 6,400 SP (6.10 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6608.58 -- Pivot Point 6576.72 - Support -- 6557.88.

The Nifty Put Call Ratio (PCR), finally stood at 1.42 for March month contract. The top five scrips with highest PCR on OI were HDFC 2.25, Voltas 1.64, ITC 1.58, Hindalco 1.42 and Ambuja Cement 1.33.

Among most active underlying, State Bank of India witnessed with contraction  of 1.04 million of Open Interest in the March month futures contract, followed by Reliance Industries  witnessing  contraction  of 1.59 million of Open Interest in the March month contract; United Spirits witnessed contraction of 1.16 million of Open Interest in the March month futures. HDFC Bank witnessed contraction of 4.95 million of Open Interest in the March month contract and TCS witnessed contraction of 0.96 million in Open Interest in the expiring March month's future contract