MAYHEM

The markets opened with a gap down and there was no looking back as the markets fell ferociously with every passing hour and eventually touched their intraday lows till the end of first half of the trading session, but tried in vain to recover some of their losses and ultimately closed very near to their lowest point of the day, till the end of the session. The Nifty and the Sensex closed down by 89 and 298 points respectively. The market breadth was also extremely negative with 286 advances to 1057 declines. On the sectoral front, there was across the sector selling, but still the Banking sector was the biggest loser followed by the Midcap, FMCG, Energy, Auto & IT sectors. On the individual stocks front, Ambuja Cement, Cipla, Baja Auto, GAIL & HeroMotocorp were the top five Nifty gainers, while Jindal Steel, Hindalco, Tata Power, DLF & ONGC were the top five Nifty losers for the day. On the institutional side, FIIs were net sellers to the tune of 886 crores, while the DIIs were net buyers to the tune of 313 crores in the cash market.

On the derivatives side, FIIs were net sellers in Index futures to the tune of 1958 crores and net buyers in Index options to the tune of 1645 crores, while they were net sellers in both Stock futures and options to the tune of 433 and 11 crores respectively. Nifty future settled at 5802, with 13 points premium to the spot along with a considerable increase in open interest. On the options side PCR stood at 0.96, along with a massive jump in India VIX by 7.62%. On the Call options side, the 5800 call added the maximum open interest, followed by the 6000, 5900 & 5700 calls, while on the Put options side, the 5500 put added the maximum open interest, followed by the 5700 & 5400 puts, while the 5900 put lost the maximum open interest, followed by the 5600, 6000 & 5800 puts. The entire activity in the F&O space indicates Call writing at higher levels along with a corresponding increase in the long positions on the Put options side, reflecting the overall trend of the market.

On the technical side, Nifty has broken all its critical support levels on increasing volumes and there seems to be no respite. Nifty has retraced almost 61.8% from its recent highs and the last support level will be its 250 day EMA. On the daily charts, however Nifty has entered the oversold levels, due to which a short technical pullback cannot be ruled out. The levels to watch out for Nifty will be 5851, 5889 on the upside and 5763, 5708 on the downside. On the currency front, the Rupee hit its record low against the dollar today, but recouped its early losses after the RBI intervened to stem the Rupee’s sharp decline. The partially convertible Rupee finally closed at 58.98, while the near month USD-INR future settled at 58.54 for the day.

On the international markets front, the Asian and the European markets have closed deep in the red, and the U.S. markets are also trading in the red after Bank of Japan governor, said he sees no need to expand the monetary stimulus immediately. On the Energy futures front, both the Brent and WTI crude oil futures are trading down 1.33 & 0.95% at 102.53 & 94.86 $/bbl respectively and the Natural gas future is also trading down by 0.86% at 3.76 $/MMBtu.