EUPHORIA

The markets opened with a gap up, tracking their Asian peers and continued their positive momentum throughout the day and eventually closed on a very firm note, near their day’s high. The Nifty and the Sensex closed, up by 67 and 215 points respectively. The market breadth was extremely positive with 926 advances to 562 declines. On the sectoral front, the Energy sector was the biggest gainer, followed by the Banking and the Auto sectors. On the individual stocks front, Reliance, Tata Motors, JP Associate, Kotak Bank & Gail were the top five Nifty gainers for the day. On the institutional side, it was clearly a one sided story, with FIIs turning net buyers to the tune of 556 crores, while the DIIs were net sellers to the tune of a mere 4 crores in the cash market.

On the derivatives side, the FIIs were net buyers in both the Index and Stock futures, to the tune of 381 and 615 crores respectively. Nifty future closed at 5296, with 13 points premium to the spot, along with a moderate increase in open interest. On the Options side, the PCR fell to 1.01, along with a marginal increase in the India VIX by 0.62%. On the Call options side, the 5400 call added the maximum open interest, followed by the 5600 and 5500 calls, on the other hand the 5200 call lost the maximum open interest, followed by the 5000, 4900 & 5100 calls. On the Put option side, 5300 put added the maximum open interest, followed by the 5400, 5200 & 5100 puts, on the other hand the 4700 put lost the maximum open interest, followed by the 4800 put. The entire activity in the cash as well as the F&O markets indicates creation of fresh longs, which was accompanied by the profit booking on the lower side and massive put writing at higher levels.

On the technical side, Nifty managed to close above the 5250, albeit on falling volumes, creating fresh hopes of breaking out of the trading range. With positive news flow from the international markets, the pullback may continue for few more sessions. The levels to watch out for Nifty will be, 5296, 5311 & 5329 on the upside and 5263, 5230 and 5200 on the downside. On the currency front the Rupee rose near to a one week high, catching up with the global risk rally, on the back of improving U.S. jobs data and assurance from the new finance minister to unveil fiscal consolidation steps. The Rupee finally settled at 55.52, while the near month USD-INR future settled at 55.71 for the day.

On the international markets front the Asian and the European markets have closed strongly in the positive zone, and the U.S. markets are also trading on a firm note, on the back of the German government backing the ECB’s bond buying plan and better than expected corporate results. On the energy futures front , both the Brent and the WTI crude futures are trading on a positive note at 109.42 & 92.02 $/bbl respectively, while the Natural Gas future is trading up by 1.58% at 2.92 $/MMBtu.