LACKLUSTER

The markets opened on a mildly positive note and gradually gained strength as the session progressed and touched their intraday highs, within one hour of the second half of the trading session, but from this point onwards the markets started falling and with just one hour left for the end of the session, the markets touched their lowest point of the day, but ultimately managed to enter the positive zone and close almost flat till the end of the session. The market breadth also turned negative, with 663 advances to 813 declines. On the sectoral front, the FMCG sector was the biggest gainer, followed by the IT & Pharma sectors, on the other hand, the Energy sector was the biggest loser, followed by the Auto sector. On the individual stocks front, Cairn, Ranbaxy, TCS, Wipro & Infosys were the top five Nifty gainers for the day, while M&M, Rel Infra, LT, Reliance Industries & ONGC were the top five Nifty losers for the day. On the Institutional side, FIIs were net buyers to the tune of 312 crores, while the DIIs were net sellers to the tune of 161 crores in the cash market.

On the derivatives side, there was hardly any activity and the FIIs were net sellers in both Index and Stock futures to the tune of a mere 4 & 77 crores respectively. Nifty future settled at 5427, with just 12 points premium to the spot, along with a moderate loss of open interest. On the Options side PCR remain constant at 1.28, along with a marginal rise in the India VIX by 0.75%. On the Call options side, except the 5500 call, there was uniform loss of open interest from the 4600 to 5600 calls, for the second consecutive session. On the Put options side, the story was same, with a exception of the 4900 call there was uniform loss of open interest from the 4600 to 5600 puts. The entire activity in the cash as well as the F&O markets indicates liquidation of some long positions, after the weak sentiment in the international markets, forced investors to take some profits off the table.

On the technical side, Nifty somehow managed to cling on to the 5400 mark, with slight increase in volumes, and looking at the combination of several technical indicators & F&O data, I still feel that there is still some room left for Nifty to move upwards. The levels to watch out for Nifty, will be 5441, 5475 & 5499 on the upside and 5389, 5359 & 5334 on the downside. On the currency front the Rupee strengthened to its highest level in two weeks, as a part of shift into global risk assets, but the gains were capped as domestic shares retreated late in the session. The rupee benefited as the dollar was broadly under pressure, sending euro to a seven week high, after U.S. Federal Reserve’s last meeting, indicated a move towards more monetary stimulus measures. The rupee finally settled at 55.26, while the near month USD-INR future also settled at 55.26 for the day.

On the international market front, the Asian markets closed on a mixed note, while the European markets have closed in the red, and the U.S. markets are also trading with losses, on the back of mixed economic data like increase in jobless claims and rise in new home sales and the same time concerns that the European leaders will fail to solve the region’s debt crisis. On the Energy futures front, the Brent crude oil future is trading almost flat at 114.81 $/bbl and the WTI crude oil future is trading down by 1.19% at 96.10 $/bbl, while the Natural gas future is trading down by 2.67% at 2.75 $/MMBtu, after the data showed an unexpected rise in U.S. Natural gas inventories.