Nifty manages to hold 5,700 level; extend gains for third straight session

NSE’s benchmark index S&P CNX Nifty, despite a range bound trade and coming in the red zone momentarily for a couple of time, managed to hold its level above 5,700 on Wednesday. Traders were taking a pause awaiting more reform announcement from the government. Earlier in the day, market made a positive start after a day of break, though the global cues were not supportive and the regional peers were mostly in red after Chinese Services PMI expanded at the weakest pace since at least March 2011 but local markets moved higher on selective buying.

Markets remained firm till the first half of the trade, surging to its intraday high awaiting report from a high-level committee, headed by HDFC Chairman Deepak Parekh, to be submitted to Prime Minister Manmohan Singh on funding of infrastructure sector. Not only the Infra sector stocks were in jubilant mood but the cement stocks too moved higher on hopes of improvement in demand. Market lost its momentum in the mid of the trade, though the European markets made mostly a positive start as Euro-area retail sales unexpectedly increased for a fourth month in August as demand rebounded in Germany, but there was cautiousness in the market ahead of the private report on American jobs and that weighed on the domestic markets too. There was also somberness with ADB cutting its growth estimates for India and saying that growth in India is expected to hit 5.6% and 6.7% in 2012 and 2013, weaker than previous forecasts of 7% and 7.5%.

Most of the sectoral indices on the NSE closed in green, CNX MNC was the top gainer up by 1.17%, CNX Energy gained 0.75%, CNX Pharma was up by 0.67%, CNX Finance was up by 0.61%, CNX Realty gained 0.35% and CNX Metal was up by 0.37%. On the other hand, CNX Auto down by 0.21% and CNX IT down by 0.20% were the losers. The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility, rose 0.98% and reached 16.50.

The India VIX witnessed an addition of 0.98% at 16.50 as compared to its previous close of at 16.34 on Monday.

The 50-share S&P CNX Nifty gained 12.45 points or 0.22% to settle at 5,731.25.

Nifty October 2012 futures closed at 5768.25 on Wednesday at a premium of 37.00 points over spot closing of 5,731.25, while Nifty November 2012 futures were at 5796.75 at a premium of 65.50 points over spot closing. Nifty October futures saw an addition of 0.85 million (mn) units taking the total outstanding open interest (OI) to 25.13 mn units. The near month October 2012 derivatives contract will expire on October 25, 2012.

From the most active contracts, JP Associates October 2012 futures were trading at a discount of 1.70 at 86.15 compared with spot closing of 87.85. The number of contracts traded was 11,935.

IVRCL October 2012 futures were trading at a premium of 0.35 at 51.00 compared with spot closing of 50.65. The number of contracts traded was 13,029.

Tata Motors October 2012 futures were at a premium of 1.90 point at 274.90 compared with spot closing of 273.00. The number of contracts traded was 13,309.

Tata Steel October 2012 futures were at a premium of 0.75 point at 404.95 compared with spot closing of 404.20. The number of contracts traded was 16,314.

Reliance Industries October 2012 futures were at a premium of 5.05 point at 852.50 compared with spot closing of 847.45. The number of contracts traded was 11,970. 

Among Nifty calls, 6000 SP from the October month expiry was the most active call with an addition of 0.80 million open interest.

Among Nifty puts, 5600 SP from the October month expiry was the most active put with an addition of 0.75 million open interest.

The maximum OI outstanding for Calls was at 6000 SP (6.04 mn) and that for Puts was at 5600 SP (5.09 mn).

The respective Support and Resistance levels are: Resistance 5744.4 -- Pivot Point 5730.1 --Support 5716.9.

The Nifty Put Call Ratio (PCR) OI wise stood at 1.18 for October - month contract.

The top five scrips with highest PCR on OI were ITC 1.48, PNB 1.42, Union Bank 1.25, Jindal Steel 1.24, and Ambuja Cement 1.16.

Among the most active underlying, Jaiprakash Associates, witnessed an addition of 4.09 million of Open Interest in the October month futures contract followed by RCOM, which witnessed an addition of 2.05 million of Open Interest in the near month contract. Meanwhile, IVRCL witnessed an addition of 10.06 million in the October month futures. Also, Shree Renuka Sugars witnessed an addition of 0.59 million in Open Interest in the October month contract. Finally, Sterlite Industries witnessed contraction of 0.23 million of Open Interest in the near month futures contract.