DESCENT

Once again the benchmark indices opened on a bad note, tracking their Asian peers and continued to drift downwards throughout the trading session and closed at their lowest point of the day. The Nifty and the Sensex closed, down by 52 & 162 points respectively. The market breadth was also extremely negative with 395 advances to 1130 declines. On the sectoral front, the Banking sector was the biggest loser, followed by the Midcap, Energy, IT and Pharma sectors. On the individual stocks front, JP Associate, HCL Tech, PNB, Hero Motocorp & ITC were the top five Nifty gainers for the day, while DLF, Siemens, IDFC, Rel Infra and State Bank of India were the top five Nifty losers for the day. On the institutional side, FIIs were net buyers to the tune of 408 crores, while the DIIs were net sellers to the tune of 396 crores in the cash market.

On the derivatives front, FIIs were net sellers in both Index and Stock futures to the tune of a massive 1012 crores and 424 crores respectively. Nifty future settled at 5672, with 20 points premium to the spot, along with a considerable loss of open interest. On the Options side the PCR stood at 1.0 with a marginal increase in the India VIX by 0.18%. On the Call options side, the 5700 call added the maximum open interest, followed by the 5900, 5600, 5800 & 6000 calls, while on the Put options side, except the 5400 & 5500 puts, which added the maximum open interest, there was uniform loss of open interest from the 5000 to 6000 puts. The entire activity in the Cash as well as the F&O markets, saw massive unwinding of long positions along with Call writing at higher levels, indicating for the first time in the last four sessions that the bears are making a comeback.

On the technical side, Nifty broke the 5700 mark on very thin volumes and found support at the crucial level of 5650 and although Nifty is still trading above most of its short and long term moving averages, the fall in volumes along with unwinding of longs indicates lack of confidence, and to make things worse the global headwinds are aggravating the bad situation. The levels to watch out for Nifty, will be 5676 & 5698 on the upside and 5637, 5624 and 5598 on the downside. On the currency front, the Rupee fell to its lowest level in two weeks after rating agency said downgrade risks remain even after the recent spate of reforms. The Rupee finally closed at 53.04, while the near month USD-INR future settled at 53.17 for the day.

On the International markets front, the Asian and the European markets have closed deep in the red, and the U.S. markets are also trading with losses amid concerns over earnings and global economic growth. On the energy futures front, the Brent crude oil future is trading up by 0.37% at 114.86 $/bbl, on the other hand the WTI crude oil future is trading down by 0.53% at 91.90 $/bbl. The Natural Gas future is trading up by 1.11% at  3.50  $/MMBtu.