RELIEF

The markets opened on a much anticipated positive note, after a series of dull sessions and both the indices maintained the positive momentum till the end of the session and both Nifty and Sensex closed up by 39 and 131 points respectively. The overall market breadth was positive with 852 advances to 622 declines. The only exception was Bank Nifty, which gave up most of its gains, after the news from Moodys , put the ratings of the three private banks namely, ICICI Bank, HDFC Bank and Axis Bank, under review and the stocks reacted accordingly and dragged the Bank Nifty downwards. The star performers of the day were TCS, Jindal steel and Power Grid. There was decent participation from the institutional side and after a long time both FIIs and DIIs turned net buyers to the tune of 479 and 247 crores respectively in the cash market.

On the derivatives side FIIs were net buyers in both Index and Stock Futures to the tune of 275 and 75 crores respectively. Nifty futures closed at 5268, with 20 points premium to the spot along-with a considerable addition of open interest. On the options side PCR fell to 1.0, along-with a increase in the India VIX by 1.67%. On the Call options side with a exception of 5000 and 5200 calls, there was considerable addition of open interest from 5100 to 5600 calls, while on the Put Options side 5200 put added the maximum open interest, followed by the 5100 and 5300 puts. The entire activity in the F&O space indicates that the odds are still stacked against the upside momentum and it will take a few more robust sessions for the markets to resume a uptrend, which will mainly come from liquidation of shorts. 

On the technical side Nifty touched the resistance of 5254 and closed very near to it, which is a encouraging sign, but much remains to be seen how the markets trade for the rest of the week. The levels to watch out for Nifty will be 5273, 5298 & 5305 on the upside and 5213, 5176 & 5151 on the downside.The rupee depreciated further and the USD-INR futures closed at 53.05.

On the international market front, with a exception of Asian markets the European and U.S. markets are trading in the green on the back of good economic data. On the energy futures side, the WTI and Brent crude futures are trading in the green at 106.02 and 119.78 $/bbl respectively.