EXUBERANCE

The markets opened on a strongly positive note, buoyed by the positive vibes from the government on the policy front. The markets gained momentum with the progressing session, but just like yesterday, the markets rose at a franctic pace, at the start of the second half of the trading session and ultimately closed at the highest point of the day. The Nifty and the Sensex closed up by 53 and 195 points respectively for the day. The market breadth was evenly balanced with 848 advances to 589 declines. On the sectoral front, once gain Banking sector was biggest gainer, followed closely by the FMCG, Energy and Midcap sectors.  On the individual stocks front there were quite a few star performers for the day, led by JP Associates and followed by Axis Bank, ICICI Bank, HDFC Bank, Sterlite Industries & Sesa Goa. On the institutional side, surprisingly FIIs turned net buyers, to the tune of a massive 675 crores for the second consecutive session, while the DIIs were net sellers to the tune of a mere 34 crores in the cash market.

On the derivatives side, FIIs were net buyers in the Index and Stock futures, to the tune of a whooping, 1132 and 641 crores respectively. Nifty future closed at 5029, with the discount, once again increasing to, 21 points to the spot, along with a considerable increase in open interest. On the options side, the PCR increased to 1.12, along with a sizeable fall in the India VIX by 5.06%. On the Call options front, the 5000 call, lost the maximum open interest, followed by the 4800 & 4900 calls, on the other hand the 5400 call added the maximum open interest, followed by the 5100 & 5500 calls. On the Put options side, the 4900 put added the maximum open interest, followed by the 5000 & 4700 puts. The entire activity in the F&O space indicates, short covering along with creation of fresh longs, which is validated by the FII data from the cash and futures market.

On the technical side, Nifty conquered, yet another level of 5050 and managed to close above the psychological mark of 5000. In order to validate the upmove, Nifty has to close above the 5000 mark. for a few more sessions and the technical indicators, indicate there is still some more steam left, before the markets become overbrought. The levels to watch out for Nifty, will be 5069, 5094 & 5121 on the upside and 5017, 4986 & 4965 on the downside. On the currency front, the Rupee appreciated considerably and the USD-INR future closed at 55.07 for the day.

On the international market front, the Asian and European markets have closed on a  strongly positive note, while the U.S. markets opened on a firm note, after China cut interest rates for the first time since 2008, to bolster growth in the world's second largest economy, but the equities pared gains after the Fed chairman, said the central bank will assess the economy, before deciding if more stimulus is needed. On the commodities front, both Gold and Silver are trading deep in the red, after a few sessions of smart gains, while both Brent and WTI crude are trading almost flat at 100.70 and 85.30 $/bbl respectively, and Natural gas is trading deep in the red, after a unexpected rise in the Natural gas inventories.