TREND CHANGE ???

The markets opened on a very weak note and continued to trade in the same range, till the second half of the trading session, but with just one and half hour left for the end of the trading session, the news of JP Morgan upgrading Indian equities from "overweight" to "neutral" on a number of factors including historic valuations, expectations for monetary stimulus, lower oil prices and a weak rupee, lent a helping hand, and the markets made a almost vertical rise from these levels and ultimately both the Indices closed at the highest point of the day. The Nifty and the Sensex closed up by 44 and 136 points respectively. The market breadth was extremely positive with 935 advances to 512 declines. On the sectoral front the, the Banking sector was the biggest gainer, followed by the FMCG, Midcap and Infrastructure sectors. On the individual stocks front, JP Associate, Rel Infra, DLF, Bhel & PNB were the star performers of the day. On the institutional side, surprisingly the FIIs were net sellers to the tune of 257 crores, while the DIIs were net buyers to the tune of a mere 69 crores in the cash market.

On the derivatives side, the FIIs brought Index futures worth 122 crores and sold Stock futures worth a mere 96 crores. Nifty future closed at 5174, with just 9 points premium to the spot, along with a considerable increase in open interest. On the options side the PCR fell to 1.18, along with a fall in the India VIX by 5.18%. On the Call options side, the 5100 call lost the maximum open interest, followed by the 5000 and 4900 calls, on the other hand the 5200 call added the maximum open interest followed by the 5300 call. On the Put options side, the 5200 put option added the maximum open interest, followed by the 5100 put, while the 4800 put lost the maximum open interest, followed by the 4600 & 4700 puts. The activity in the F&O space, indicates fresh longs on the futures side along with massive put writing at higher levels, but the FII sell figures in the spot market, indicates that the entire focus will be shifting to the futures side.

On the technical side, Nifty managed to conquer the psychological 5150 mark, on huge volumes and most importantly, it is trading above all its short term exponential moving averages, which adds credence to the fact that this up-move might be sustained for some more time, if there is no major negative news-flow from the domestic and international markets. The levels to watch out for Nifty,will be 5192, 5219 & 5249 on the upside and 5115, 5095 & 5066 on the downside.

On the currency front, the Rupee fell to a record against the dollar as the Euro and the other  risk assets were hit by disappointment, about the size of bond purchases announced by the Federal reserve and by weak global economic data.The rupee fell at one point to a record low of 56.55 to the dollar, surpassing its previous 56.52 low.However, the local currency recovered losses on the back of rallying domestic equities to settle at 56.30/31 versus its 56.15/16 close on Wednesday, while the USD-INR future closed at 56.43 for the day.

On the international markets front, the Asian markets have closed almost flat,and the European markets have closed in the red after weak factory data from China and a contraction in the euro zone's private sector contributed to the falls. The U.S. markets are trading deep in the red,after a gauge of Philadelphia-area manufacturing unexpectedly fell, while housing and jobless claims reports also disappointed. On the energy futures front, both the Brent and WTI crude futures are trading down by 3.5% at 89.70 & 78.67 $/bbl respectively, while the Natural gas future is trading  up, by close to 2%, at 2.56 $/MMBtu, on the back of unexpected fall in U.S. natural gas inventories.