COMEBACK

As expected, the benchmark indices opened with a gap up and continued to trade with the same momentum throughout the trading session and ultimately closed near their highest point of the day. The market breadth was extremely strong with 1037 advances to 450 declines. On the sectoral front, the Banking sector was the biggest gainer, followed by the Energy, IT & FMCG sectors. On the Individual stocks front, DLF, Tata Steel, ICICI Bank, Tata Motors & JP Associate were the top five Nifty gainers for the day, while BPCL was the sole Nifty loser for the day. On the institutional side, both FIIs and DIIs were net buyers to the tune of 502 & 218 crores respectively in the cash market.

On the derivatives side also, the story was same, where FIIs were net buyers in both Index and Stock futures to the tune of a massive 652 and 675 crores respectively. Nifty future settled at 5359, with just 17 points premium to the spot, along with a considerable increase in open interest. On the options side PCR increased to 1.15, along with a massive fall in the India VIX by 10.13%. On the Options side, except the 5600 call, there was uniform loss of open interest from the 4600 to 5500 calls. On the Put options side, the 4900 put lost the maximum open interest, followed by the 4800 & 5000 puts, while the 5300 put added the maximum open interest, followed by the 5400, 5200 & 5100 puts. The entire activity in the cash as well as the F&O markets, clearly indicates addition of longs in the cash as well as the Index futures, along with liquidation of shorts on the call options side and put writing at higher levels.

On the technical side, till Thursday Nifty was struggling to stay above the 5200 mark, but the next day it was a all together different scenario where Nifty settled comfortably above the 5300 mark, with marginal increase in volumes. The next two sessions are going to decide, whether this up-move is sustainable and with most of the international indices closing on a strong note for the week, there are chances that this momentum is likely to continue for some more time. The levels to watch out for Nifty, will be 5256, 5370 & 5394 on the upside and 5318, 5298 & 5287 on the downside. On the currency front, the Rupee rose on Friday, in line with the other Asian currencies and shares, after ECB put forward a plan for buying bonds to help the ailing Eurozone economies, which in turn increased the risk appetite of the markets. The Rupee finally settled at 55.35, while the near month USD-INR future settled at 55.52 for the week.

On the international markets front, the Asian markets closed on a very strong note, while the European and U.S. markets closed almost flat, after the strong rally on Thursday. On the Energy futures front, the Brent crude oil future closed up by 0.67%, at 114.25 $/bbl, and the WTI crude oil future closed up by 0.93 %, at 96.42 $/bbl, while the Natural Gas future closed down by 3.39%, at 2.68 $/MMBtu for the week.