CAUTION

The markets opened on a flat note and momentary entered the negative zone, within the first one and a half hours of the trading session and recovered thereafter, to stay range-bound for the entire day and both Nifty and Sensex closed, up by 32 and 111 points respectively. On the sectoral front the FMCG shares were the major gainers followed by the Banking and the IT shares. The star performers of the day were Coal India, Maruti, Kotak Bank & Tata Motors. The market breadth was evenly balanced with 745 advances to 735 declines. On the institutional side, the FIIs were sellers to the tune of merely 102 crores and DIIs were net buyers to the tune of 101 crores in the cash market. On  the derivatives side the FIIs brought Index futures worth 653 crores and sold stock futures worth 372 crores. Nifty futures closed at 5356, with 24 points premium to the spot and addition of considerable open interest. On the options side PCR decreased to 1.05,  with a fall in India VIX by 3.39%. On the Call options side, with a exception of 5500 call, there was considerable shedding of open interest from 5000 to 5600 calls, while on the Put options side 5300 put added the maximum open interest, followed by the 5400 and 5100 calls. The activity in the F&O space indicates unwinding of shorts and addition of long positions for the fourth consecutive session. This entire activity is happening, on the back of low volumes and lack of institutional participation in the spot market, which makes us skeptical, of the gains in the last four sessions. On the technical side, the positive momentum must continue for a few more sessions to confirm the  trend reversal. The levels to watch for Nifty will be 5352, 5372 & 5403 on the upside and 5292,5278 & 5260 on the downside.On the international market side the European markets have closed in the red, while the U.S. markets are trading in the red, on the back of poor corporate results and worst than expected jobless claims and existing home sales data.The USDINR futures closed at 52.22 and the WTI and Brent crude futures are trading flat.

STOCK PICKS

AXIS BANK -  SELL 1210-1220, SL 1234. TGT - 1182, 1171

LT -                  SELL 1320- 1330 SL 1353. TGT - 1308, 1293