Firm global cues propel Nifty over 5,250 level

Bulls retaliated back on Monday and the local index S&P CNX Nifty snapped the day’s trade with a gain of over a percentage point after falling for two days on the back of stronger than expected US payroll data, while some positive cues from Euro-zone too aided the sentiments. The European markets were trading firm even as investors grew cautious over the prospects of a bailout for Spain, with its 10-year bond yield holding close to 7% danger levels. While, all the Asian equity indices ended the session in the positive trajectory. Back home, Reliance Industries (RIL) too supported the markets and the stock edged higher by over five and a half percent on the buzz that the company has agreed to share the KG-D6 accounts with the national auditor under the terms of the production sharing contract (PSC), ahead of a crucial meeting of the block’s management committee.

The market made a gap-up opening and regained its crucial 5,250 mark in early trade on firm global cues. Moreover, telecom stocks too supported the sentiments in the initial trade as after fixing the minimum price at Rs 14,000 crore for 5 units of GSM airwaves in the 1800 MHz, the panel of ministers on spectrum, headed by finance minister P Chidambaram, will meet today to consider a revised timeline for the spectrum auctions, as the government may not be able to meet the deadline for completing the sale process by this month-end. Inflow of foreign money too helped Indian equities as the Indian rupee appreciated by 30 paise to 55.45 against the US dollar. In addition, pharma stocks too provided strength to the market, with Sun Pharmaceuticals Industries and Wockhardt hitting record highs. Divi’s Laboratories hit record high on strong Q1 results. Glenmark Pharmaceuticals hit 52-week high after the company said its US unit has received final abbreviated new drug approval from the US Food and Drug Administration for Montelukast Sodium Tablets in 10 milligram strength. In the mid noon trade, market witnessed some profit booking following flat-to-negative opening in the early trade however, the index recovered soon after European markets turned green. Moreover, better than expected Q1 numbers from SKS Microfinance, Cadila Healthcare, SAIL and Wockhardt aided the sentiments. Finally, Nifty ended over its crucial 5,280 mark with a gain of over a percent.

Meanwhile, most of the sectoral indices on the NSE were settled in the green, CNX Auto remained the major gainer, up 1.94% followed by Bank Nifty up 1.42% and CNX Realty up by 1.31% while CNX FMCG declined 0.21% remained the lone loser. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, rose 0.62% and reached 16.22.

The India VIX witnessed an addition of 0.62% at 16.22 as compared to its previous close of at 16.12 on Thursday.

The 50-share S&P CNX Nifty gained 66.85 points or 1.28% to settle at 5,282.55.

Nifty August 2012 futures closed at 5296.85 on Monday at a premium of 14.30 points over spot closing of 5,282.55, while Nifty September 2012 futures were at 5322.35 at a premium of 39.80 points over spot closing. Nifty August futures saw an addition of 0.09 million (mn) units taking the total outstanding open interest (OI) to 22.49 mn units. The near month August 2012 derivatives contract will expire on Thursday i.e. August 30, 2012.

From the most active contracts, Tata Motors August 2012 futures were at a premium of 0.65 points at 229.70 compared with spot closing of 229.05. The number of contracts traded was 9,526.

DLF August 2012 futures were at a discount of 2.45 point at 209.25 compared with spot closing of 211.70. The number of contracts traded was 8,200.

Reliance Industries August 2012 futures were at a premium of 5.30 point at 788.80 compared with spot closing of 783.50. The number of contracts traded was 23,835.

Tata Steel August 2012 futures were at a premium of 4.20 points at 407.40 compared with spot closing of 403.20. The number of contracts traded was 11,229.

ICICI Bank August 2012 futures were at a premium of 3.30 point at 957.60 compared with spot closing of 954.30. The number of contracts traded was 16,648. 

Among Nifty puts, 5000 SP from the August month expiry was the most active put with an addition of 10.33 million open interest.

The maximum OI outstanding for Calls was at 5500 SP (8.39 mn) and that for Puts was at 5000 SP (10.25 mn).

The respective Support and Resistance levels are: Resistance 5296.88 -- Pivot Point 5278.86 --Support 5264.53.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.31 for August -month contract.

The top five scrips with highest PCR on OI were Oriental Bank 5.00, WEL Corp 3.42, YES Bank 2.25, STR Tech 2.00, and Sun Pharma 1.95