WAIT AND WATCH

The benchmark indices opened on an absolutely flat and traded rangebound for the entire first half of the trading session, but at the start of the second half of the trading session the markets  gradually started rising and ultimately both the indices closed near their highest point of the day. The market breadth however remained negative with 556 advances to 931 declines. The Nifty and the Sensex closed up by 25 and 100 points respectively. On the sectoral front, the Energy sector was the biggest gainer followed by the Banking and FMCG sectors. On the individual stocks front, ONGC, Sun Pharma, HCL Tech, Tata Motors & Coal India were the top five Nifty gainers while Jindal Steel, IDFC, ACC, DLF & Infosys were the top five Nifty losers for the day. On the institutional side, FIIs were net buyers to the tune of 604 crores while DIIs were net sellers to the tune of 412 crores in the cash market.

On the derivatives side, FIIs were net sellers in both Index futures and Options to the tune of 236 and 28 crores respectively, while they were net buyers in Stock futures and Options to the tune of 171 and 25 crores respectively. Nifty future settled at 5941, with 19 points premium to the spot, along with a marginal increase in open interest. On the options side, PCR stood at 0.98 along with a fall in the India VIX by 2.17%. On the Call options side there was hardly any activity with marginal decrease in open interest in the 6000 call followed by the 6100 & 6200 calls, while the 5800 call added the maximum open interest. On the Put options side, the 5700 put added the maximum open interest followed by the 5900 & 6000 puts, while the 5600 put lost the maximum open interest followed by the 6100, 5800 & 6200 puts. The entire activity in the cash market was sector specific while in the F&O space there was some short covering, which helped the markets recover till the end of the session.

On the technical side, Nifty managed to hold on to the 5900 mark, but the underlying market breadth indicates all is not well and the selling pressure may resume due to the depressing news on the domestic front. The levels to watch out for Nifty will be 5937 & 5952 on the upside and 5896 & 5870 on the downside. On the currency front, the Rupee ended almost steady as data showed a contraction in industrial output and continued high consumer inflation raised uncertainty about how aggressively the central bank would cut interest rates this year. The partially convertible Rupee finally closed at 53.85, while the near month USD-INR future settled at 54.04 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 very strong note and the U.S markets are trading almost flat, as investors watch corporate earnings before the President’s State of the Union Address. On the Energy futures front, both Brent and WTI crude oil futures are trading almost flat at 117.33 and 97.50 $/bbl respectively, while the Natural gas future is trading down by 1.02% at 3.24 $/MMBtu.