UPSWING

The new F&O series began with a bang as the markets opened with a gap up, and touched their intraday highs within the first one and a half hours of the trading session and maintained the positive momentum till the end of the session. The market breadth was also extremely positive with 925 advances to 595 declines. On the sectoral front the FMCG sector was the biggest gainer, followed by the Energy, Pharma, Auto and Media sectors. On the individual stocks front, Hindalco, Power Grid, Tata Motors, Sun Pharma & Bank of Baroda were the top five Nifty gainers for the day, while RelInfra, DLF, IDFC, HCL Tech & Infosys were the top five Nifty losers for the day. On the institutional side, the FIIs were net buyers, to the tune of 1230 crores, while the DIIs were net sellers to the tune of 679 crores in the cash market.

On the derivatives side, FIIs were net buyers in Index futures, to the tune of 999 crores, and net sellers in Stock futures to the tune of 579 crores. Nifty future settled at 5729, with 26 points premium to the spot, along with a considerable addition of open interest. On the Options side, PCR stood at 1.03, along with a fall in the India VIX by 4.44%. On the Call Options side, except the 5900 call, which added the maximum open interest, there was uniform loss of open interest from the 4900 to 5800 calls, while on the Put Options side, the 5400 put added the maximum open interest, followed by the 5700, 5600, 5500 & 5800 puts. The entire activity in the cash and F&O markets indicates addition of fresh longs on the Index futures side, along with profit booking on the call options side, and Put writing at lower levels, which indicates the overall bullish sentiment of the market.

On the technical side, as expected, after consolidating before the expiry, Nifty finally settled at 5703, its 16 month high, with increasing volumes, coupled with strong FII inflows and positive data from the F&O side, there seems to be a real possibility of Nifty making new highs in the coming week, if the international market news remains supportive. The levels to watch out for Nifty will be 5731, 5759 & 5781 on the upside and 5679, 5655 & 5627 on the downside. On the currency front the Rupee rose to its five-month high as global risk sentiment improved and the government stuck to its original borrowing plan, showing further signs of fiscal discipline. The Rupee finally settled at 52.85 for the week, while the near month USD-INR future settled at 53.07 for the week.

On the International markets front, the Asian and the European markets settled in the red, for the week, and the U.S. markets also settled with losses, after data showed the U.S. business activity unexpectedly contracted in September. On the Energy futures front, both the Brent  & WTI crude oil futures closed marginally positive at 112.39 & 92.19 $/bbl respectively, while the Natural Gas future closed up by 0.70% at 3.32 $/MMBtu.