CAUTION

Once again the markets opened on a firm note, but after trading rangebound for the initial two hours of trade, the markets lost all their gains and traded in the negative territory for the next one and half hours and surprisingly recovered their losses beyond this point and once again started trading strongly and ultimately both the indices managed to close near their highest point of the day.  The Nifty and the Sensex closed up by 26 and 101 points respectively. The market breadth was however evenly poised with 694 advances to 683 declines. On the sectoral front, the FMCG sector was the biggest gainer, while the rest of the sectors closed with marginal gains or losses. On the individual stocks front, HDFC, Ultratech Cement, Lupin, ITC & Power Grid were the top five Nifty gainers, while Ranbaxy, Bharti Airtel, Tata Steel, Bank of Baroda & Hero Motocorp were the top five Nifty losers for the day. On the institutional side, FIIs were net buyers to the tune of 977 crores and DIIs were net sellers to the tune of 669 crores in the cash market.

On the derivatives side, FIIs  were net buyers in both Index futures and Options, to the tune of 1081 and 141 crores respectively, while they were net sellers in both Stock futures and options to the tune of 404 and 41 crores respectively. Nifty future settled at 6075, with just 6 points premium to the spot, along with a marginal increase in open interest.On the Options side, PCR stood at 1.0, along with a rise in the India VIX by 1.58%. On the Call options side, the 6200 call added the maximum open interest, followed by the 6100 call, while there was uniform loss of open interest from the 5000 to 6000 calls. On the Put options side, 6000 put added the maximum open interest, followed by the 5900, 6100 & 5800 puts. The entire activity in the F&O space indicates further addition of long positions along with put writing .

On the technical side, Nifty touched yet another milestone, helped by the positive sentiment from the international markets, but in today’s gain there were clear signals of fatigue, which indicates that the markets may consolidate before making another upmove. The levels to watch out for Nifty will be 6093, 6117 on the upside and 6034, 5999, 5975 on the downside. On the currency front, the Rupee remained in a tight range today as positive sentiment due to stronger Asian currencies and the Euro was offset by demand for dollars from the custodian banks and oil importers. The partially convertible Rupee finally closed at 54.16, while the near month USD-INR future settled at 54.18 for the day.

On the international markets, the Asian and the European markets continued to scale new peaks and the U.S. markets have risen as earnings outlook for corporates beat analyst estimates. On the Energy futures front, Brent crude oil future is trading down by 0.21% at 104.22 $/bbl, while the WTI crude oil future is trading up by 0.55% at 96.16 $/bbl and the Natural gas future is trading up by 0.91% at 3.95 $/MMBtu after a more than expected fall in weekly U.S Gasoline inventories.