DOWNTREND ??

The markets opened on a somber note, tracking their Asian peers, and continued to trade with a negative bias till the start of the second half of the trading session, but from this point onwards the rate of descent became very sharp and ultimately both the indices closed near their lowest point of the day. The Nifty and the Sensex closed, down by 71 & 229 points respectively. The market breadth was extremely negative, with 664 advances to 841 declines. On the sectoral front, the Energy sector was the biggest loser, followed by the Banking, IT, Auto & Infra sectors, while the Pharma sector was the sole gainer for the day. On the individual stocks front Sun Pharma, Asian Paint, Bharti Airtel, Ultratech cement & Cairn India were the top five Nifty gainers for the day, on the other hand DLF, Reliance Industries, RelInfra, BHEL & Hindalco were the top five Nifty Losers for the day. On the institutional side, FIIs were net buyers to the tune of 564 crores, while the DIIs were net sellers to the tune of 779 crores, in the cash market.

On the derivatives side, FIIs were net buyers in Index futures to the tune of 229 crores and net sellers in Stock futures to the tune of 434 crores. Nifty future settled at 5701, with the premium narrowing down to 25 points, along with a marginal decrease in open interest. On the Options side, PCR fell to 0.99, along with an increase in the India VIX by 2.32%. On the Call options side, the 5700 call added the maximum open interest, followed by the 5900, 5800 & 6000 calls, while on the Put options side, the 5600 put added the maximum open interest, followed by the 5400 & 5500 puts on the other hand the 5300 put lost the maximum open interest, followed by the 5700 & 5800 puts. The entire activity in the Cash as well as the F&O markets, indicates little participation by the market participants in both the segments along with some profit booking and opportunistic call writing at higher levels, in the face of uncertainty surrounding the international markets.

On the technical side, spot Nifty broke the 5700 mark on decreasing volumes and finally settled at 5676 for the day. Although it may be too early to suggest a downtrend, but the way the markets have fallen over the past two sessions, as a mark of caution ,one should book partial profits and trade with strict stop losses. The daily and weekly technical indicators, have also turned negative over the last few sessions. The levels to watch out for Nifty, will be 5730 & 5766 on the upside and 5644, 5612 and 5577  on the downside. On the currency front, the Rupee fell to its one week low today, as custodian banks brought dollars on the back of sharp losses in shares, while global risk assets weakened on global economy concerns. The Rupee finally settled at 52.64, while the near month USD-INR future settled at 52.75 for the day.

On the international markets front, the Asian markets have closed on a mixed note, while the European markets have closed deep in the red, and the U.S. markets also trading with losses after Apple Inc. paced a slump in the technology companies and as European finance ministers  meet to discuss  the regions government debt crisis. On the energy futures side, both the Brent and WTI crude oil futures are trading down by close to half a percent, at 111.86 & 89.51 $/bbl respectively, while the Natural Gas future is trading almost flat at 3.40 $/MMBtu.