UNEASY

The markets opened on a negative note, but as the session progressed, the markets were in for a roller coaster ride, when the markets touched their intraday lows, within the initial two hours of trade, but again recovered almost all their losses over the next one and a half hours, to fall once again and close near their new intraday lows till the end of the session. The markets fell on Friday after the RBI cautioned it has limited room for further monetary easing, overshadowing the 25bps cut in key interest rate. The Nifty and the Sensex closed down by 55 and 160 points respectively. The market breadth was also extremely negative with 524 advances to 842 declines. On the sectoral front, the Banking sector was the biggest loser, followed by the FMCG and Auto sectors. On the individual stocks front, Jindal Steel, Hindalco, Tata Steel, HCL tech and Sun Pharma were the top five Nifty gainers, while Tata Motors, State Bank of India, Icici Bank, IDFC & GAIL were the top five Nifty losers for the day. On the institutional side FIIs were net buyers to the tune of 954 crores and DIIs were net sellers to the tune of 793 crores in the cash market.

On the derivatives side, FIIs were net sellers in Index futures and Options to the tune of 13 and 468 crores respectively, while they were net sellers in Stock futures to the tune of 684 crores and net buyers in Stock options to the tune of 24 crores. Nifty future settled at 5948, with just 4 points premium to the spot, along with a marginal decrease in open interest. On the Options side, PCR stood at 1.07, along with a fall in the India VIX by 4.48%. On the Call options side, there was uniform loss of open interest from the 5000 to 5900 call, while the 6100 & 6000 call added the maximum open interest. On the Put options side, the 5500 put added the maximum open interest, followed by the 5800 & 5700 puts. The entire activity in the F&O space indicates mild profit booking due to less favorable market news.

On the technical side, although Nifty corrected a bit, but it still remains in the breakout zone and as of now, there seems no real danger of slipping back into the downward channel. The levels to watch out for Nifty, will be 5986, 6028 on the upside and 5916, 5888 on the downside. On the currency front, the Rupee weakened on Friday, as the central bank disappointed the markets with their hawkish tone in its annual monetary policy, despite delivering a widely expected 25 basis point rate cut. The partially convertible Rupee finally closed at 53.93, while the near month USD-INR future settled at 54.08 for the week.

On the International markets front, the Asian markets closed on a mixed note, while the European and the U.S. markets have closed for the week on a strongly positive note. On the energy futures front, the Brent crude oil future has closed up by 1.30% at 104.19 $/bbl, and the WTI crude oil future has closed at 95.61 $/bbl, while the Natural gas future has closed at 4.04 $/MMBtu.