Nifty closes above crucial 6600 level ahead of F&O series expiry

Nifty, after opening stronger amid upbeat global cues and witnessing some volatility at the ‘fag end’ of the session, managed to hold onto the crucial psychological level of 6600 ahead of the F&O series expiry on Wednesday. Index made a gap-up start and held its gains for major part of the day until a little volatility was witnessed during the last part of the session when the index dipped into the red briefly but was bought into regaining the important 6600 level.

Sentiments were up-beat on hopes that stable government post the elections would help accelerate much-needed reforms process and decision making needed to kick-start India's sluggish economy. Buying in banking related stocks aided the sentiments on report that Reserve Bank of India (RBI) will keep the rates unchanged. Further, Capital inflows by foreign funds and appreciating rupee steadied the index.

Meanwhile, sectoral indices on the NSE made positive closing. CNX Metal up by 2.64, CNX PSU Bank up by 1.44%, CNX Energy up by 0.90%, CNX Auto up by 0.88% and CNX Bank up by 0.55% remained the gainers in the trade. While, CNX Pharma down by 2.07%, CNX Media down by 1.96%, CNX IT down by 0.84%, CNX FMCG down by 0.69% and CNX Realty down by 0.08% 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 4.99% and reached 17.7650. The 50-share CNX Nifty increased by 11.65  points or 0.18% to settle at 6,601.40.

Nifty March 2014 futures closed at 6,612.55 on Wednesday at a premium of 11.15 points over spot closing of 6,601.40, while Nifty April 2014 futures ended at 6670.25 at a premium of 68.85 points over spot closing. Nifty March futures saw contraction of 3.29 million (mn) units, taking the total outstanding open interest (OI) to 15.42 mn units. The near month March 2014 derivatives contract will expire on March 27, 2014.

From the most active contracts, HDFC Bank March 2014 futures were at a premium of 1.75 points at 748.80 compared with spot closing of 747.05. The number of contracts traded was 20,629.

Reliance Industries March 2014 futures traded at a premium of 2.75 points at 893.75 compared with spot closing of 891.00. The number of contracts traded was 26,077.

Yes Bank March 2014 futures traded at a discount of 0.80 points at 401.80 compared with spot closing of 402.60. The number of contracts traded was 22,882.

ICICI Bank March 2014 futures traded at a premium of 5.65 points at 1260.65 compared with spot closing of 1255.00. The number of contracts traded was 22,558.

Axis Bank March 2014 futures were at a premium of 3.65 points at 1429.10 compared with spot closing of 1425.45. The number of contracts traded was 24,992.

Among Nifty calls, 6,700 SP from the March month expiry was the most active call with an addition of 0.01 million open interest.

Among Nifty puts, 6,400 SP from the March month expiry was the most active put with an addition  of 0.15 million open interest.

The maximum OI outstanding for Calls was at 6,700 SP (5.55 mn) and that for Puts was at 6,400 SP (6.24 mn).

The respective Support and Resistance levels of Nifty are: Resistance 6625.7 -- Pivot Point 6603.15 - Support -- 6578.85.

The Nifty Put Call Ratio (PCR), finally stood at 1.49 for March month contract. The top five scrips with highest PCR on OI were HDFC 2.26, Hindalco 1.93, Voltas 1.65, Maruti 1.44, and Hero Motoco 1.39.

Among most active underlying, State Bank of India witnessed with contraction  of 1.42 million of Open Interest in the March month futures contract, followed by Reliance Industries  witnessing  contraction  of 1.00 million of Open Interest in the March month contract; United Spirits witnessed contraction of 0.64 million of Open Interest in the March month futures. ICICI Bank witnessed contraction of 0.91 million of Open Interest in the March month contract and HDFC Bank witnessed contraction of 4.30 million in Open Interest in the expiring March month's future contract