CONSOLIDATION

The markets opened on a positive note and touched their intraday highs at the end of the first hour of the trading session, but from this point onwards, the markets started losing their gains and gradually the market breadth worsened as the session progressed and ultimately, with just two hours left for the end of the day’s session, the markets entered the negative zone and ultimately both the benchmark indices closed almost flat for the day. The Nifty and the Sensex closed down by 10 & 22 points respectively. The market breadth was extremely negative with 476 advances to 1073 declines. On the sectoral front, the energy sector was the biggest loser followed by the IT and Banking sectors, while the FMCG sector was the biggest gainer for the day. On the individual stocks front, Jindal Steel, Bajaj Auto, Ambuja Cement, Hind Unilever & Ultratech Cement were the top five Nifty gainers, while Hindalco, Bhel, Cairn, DLF & NTPC were the top five Nifty losers for the day. On the institutional side, surprisingly FIIs were net buyers to the tune of 1310 crores, while the DIIs were net sellers to the tune of 1028 crores in the cash market.

On the derivatives side, FIIs were net buyers in Index futures and options to the tune of 487 and 255 crores respectively and net sellers in Stock futures and Options to the tune of 349 and 16 crores respectively. Nifty future settled at 5928, with 29 points premium to the spot, along with a marginal increase in open interest. On the Options side PCR stood at 0.92, along with a marginal increase in the India VIX by 1.10%. On the Call options side, the 6000 call added the maximum open interest, followed by the 5900 call, while there was uniform loss of open interest from the 5000 to 5800 calls. On the Put Options side, the 5800 put added the maximum open interest, followed by the 5900 & 6000 puts, while the 5500 put lost the maximum open interest, followed by the 5600 & 5400 puts. The entire activity in the Cash market was again stock specific, while in the F&O space the markets participants continued to add to their long positions, along with some profit booking in the call and put options side.

On the technical side, after four consecutive sessions of trading above the 5900 mark , Nifty finally broke the level but managed to close very near to it. Nifty is still trading above all its short and long term moving averages and the momentum indicators on the weekly charts indicate, there is still more upside left. The levels to watch out for Nifty will be, 5948 & 6009 on the upside and 5833, 5809 on the downside. On the currency front, the Rupee rose today on the back of inflows from Bharti Infratel IPO and expected dollar sales, from a share sale by NMDC but data showing a high trade deficit weighed on investor sentiment. The partially convertible Rupee finally closed at 54.26, while the near month USD-INR future settled at 54.47 for the day.

On the International markets front, the Asian markets have closed on a mixed note, while the European markets have closed on a positive note and the U.S. markets are trading on a strong note after German confidence climbed up and amid speculation that progress was being made in federal budget talks in Washington. On the energy futures front, both the Brent and WTI crude oil futures are trading almost flat at 106.38 & 85.59 $/bbl respectively while the Natural Gas future is trading marginally down at 3.44 $/MMBtu.