GRITTY

The benchmark indices opened on a flat note, but were in for a rude shock, when a freak trade happened and Nifty plunged 927 points within a minute and investors lost crores of rupees within a few seconds, while the exact cause is yet to be known but it was a very bad end to a jubilant week for the markets, but after the initial shock, the markets recovered the next moment and traded range-bound till the end of the session. The Nifty and the Sensex closed down, by 40 and 120 points respectively for the week. The market breadth also turned extremely negative, with 450 advances to 1078 declines. On the individual stocks front, Tata Motors, Hind Unilever, M&M, ONGC & LT were the top five Nifty gainers for the day, while HDFC, HCL- Tech, Rel Infra, JP Associate & Wipro were the top five Nifty losers for the day. On the institutional side, the picture was quite different, where FIIs were net buyers to the tune of a massive 4352 crores, while the DIIs were net sellers to the tune of a mere 189 crores in the cash market.

On the derivatives side, surprisingly the FIIs were net sellers in both Index and Stock futures, to the tune of 616 and 433 crores respectively. Nifty future settled at 5776, with 29 points premium to the spot, along with a considerable increase in open interest. On the Options side PCR stood at 1.13, along with a 2.07% increase in the India VIX. On the Call Options side, the 5800 call added the maximum open interest, followed by the 5900, 6000 & 5700 calls, while on the Put Options side, the 5200 put lost the maximum open interest, followed by the 5400 & 5600 puts and on the other hand the 5500 put added the maximum open interest. The entire activity in the cash as well as the F&O markets indicates massive build up of long positions in the cash as well as the options side, indicating the strong under-current of this market rally.

On the technical side, spot Nifty closed comfortably above the 5700 mark for the fifth consecutive session, with slight fall in volumes. The breakout above the 5450 mark is two weeks old now and Nifty is still trading above all its short and long term moving averages. The levels to watch out for Nifty, will be 5788 & 5830 on the upside and 5730, 5714 & 5682 on the downside. On the currency front, the Rupee fell on Friday, following large outflows from a private equity firm’s stake sale. The Rupee finally settled at 51.85, while the near month USD-INR future settled at 52.08 for the week.

On the International markets front, the Asian and the European markets closed on a very strong note, and the U.S. markets also rose, sending the S&P 500 above the highest closing level, since 2007, as an unexpected drop in the American unemployment rate bolstered confidence in the world’s largest economy. On the energy future’s front, the Brent crude oil future closed down by 0.50% at 112.02 $/bbl, and the WTI crude oil future closed down by 2.0% at 89.88 $/bbl, while the Natural Gas future also closed down by 0.29% at 3.39 $/MMBtu.