Nifty ends near pre-close level ahead of inflation data, US Fed meet

After witnessing six-day rally, Indian benchmark Nifty consolidated gains as cautious sentiment prevailed ahead of the US Federal Open Markets Committee (FOMC) meeting outcome later in the day and monthly inflation data on Sept 14. On the global front, Asian stock markets rose on Thursday, underpinned by expectations that the Federal Reserve will announce new measures to stimulate the US economy, while the cautiousness ahead of the similar Fed meeting led to the slide of European equities. Back home, HSBC cut its GDP growth forecasts for FY13 and FY14. It expects India to grow 5.7% in FY13, down from its previous forecast of 6.2%.

Initially, benchmark kick started the session in the green terrain and extended its up-move amid constant buying across the board in the late morning session. Market touched its intraday high near crucial 5,450 mark in the morning trade as sentiments turned higher after state-owned oil marketing companies IOC, BPCL and HPCL edged up on reports that a Cabinet Committee on Political Affairs (CCPA) will meet later in the day for deciding diesel, cooking gas and kerosene price hike. At the same time, buying in PSU space also supported the sentiments as shares of select PSU companies edged higher amid media reports that the Union Cabinet on Friday will consider approving plans for selling some of the Government’s stake in five state-run companies. Moreover, some amount of support also came in from Airline stocks, which gained after reports said that the CCEA would consider a plan to allow foreign airlines to pick up equity of up to 49% in Indian carriers. However, investors started profit booking in the noon trade following weakness in European counters. Gains also remain capped as shares of Pantaloon Retail and Shoppers Stop after Union Commerce 7 Industry Minister Anand Sharma announced that the proposal to allow foreign retailers such as Wal-Mart and Carrefour to set up shop in India was not on the CCEA's agenda. Finally, Nifty snapped the day’s trade in the green terrain near its pre-close level.

Meanwhile, most of the sectoral indices on the NSE were settled in the green, CNX FMCG remained the major gainer, up 0.66% followed by CNX IT up 0.44% and CNX Media up by 0.41% while CNX Pharma and CNX Realty declined 1.41% and 0.53% remained the top losers in the trade. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, rose 4.19% and reached 15.67.

The India VIX witnessed an addition of 4.19% at 15.67 as compared to its previous close of at 15.04 on Wednesday. The 50-share S&P CNX Nifty gained 4.35 points or 0.08% to settle at 5,435.35.

Nifty September 2012 futures closed at 5450.70 on Thursday at a premium of 15.35 points over spot closing of 5,435.35, while Nifty October 2012 futures were at 5476.10 at a premium of 40.75 points over spot closing. Nifty September futures saw an addition of 0.26 million (mn) units taking the total outstanding open interest (OI) to 18.69 mn units. The near month September 2012 derivatives contract will expire on Thursday i.e. September 27, 2012.

From the most active contracts, Tata Motors September 2012 futures were trading at a premium of 1.25 at 259.85 compared with spot closing of 258.60. The number of contracts traded was 13,602.

BHEL September 2012 futures were trading at a premium of 0.90 points at 201.40 compared with spot closing of 200.50. The number of contracts traded was 7,838.

Tata Steel September 2012 futures were at a premium of 1.95 point at 387.95 compared with spot closing of 386.00. The number of contracts traded was 11,818.

Reliance Industries September 2012 futures were at a premium of 6.20 points at 801.35 compared with spot closing of 795.15. The number of contracts traded was 8,782.

ICICI Bank September 2012 futures were at a premium of 0.70 point at 959.70 compared with spot closing of 959.00. The number of contracts traded was 14,641.

Among Nifty calls, 5600 SP from the September month expiry was the most active call with an addition of 1.32 million open interest.

Among Nifty puts, 5300 SP from the September month expiry was the most active put with an addition of 0.49 million open interest.

The maximum OI outstanding for Calls was at 5600 SP (9.67 mn) and that for Puts was at 5300 SP (10.01 mn).

The respective Support and Resistance levels are: Resistance 5438.91 -- Pivot Point 5430.38 --Support 5413.31.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.19 for September-month contract.

The top five scrips with highest PCR on OI were Abirlanuvo 4.00, Federal Bank 3.00, Bharat Forg 2.00, TCS 1.71, and Orient Bank 1.67.

Among the most active underlying, IFCI witnessed contraction of 0.56 million of Open Interest in the September month futures contract followed by RCOM which witnessed an addition of 2.31 million of Open Interest in the near month contract. Meanwhile, JP Associates witnessed contraction of 0.95 million in the September month futures. Also, Hindalco witnessed contraction of 1.15 million in Open Interest in the September month contract. Finally, Tata Motors witnessed contraction of 0.39 million of Open Interest in the near month futures contract.