Derivative market update
After a lackluster opening Nifty slid in the red as the session progressed and finally ended the day with a loss of 36 points at 5350. Amongst the sectoral indices the BSE Oil & Gas index was a relative outperformer as it ended in the green whereas BSE Realty and Bankex witnessed profit taking.
We had indicated that Nifty may continue to remain under selling pressure as long as it trades below the resistance of 5450 levels. It is now near a major support level of 5350/5340 levels which is a make or break level for bulls at least for the short term. Any breach of 5340 could induce further weakness till 5280 levels
However if Nifty manages to sustain above 5340 then we may witness a minor bounce back till 5440 levels. The level of 5450 would continue to serve as a stiff resistance for Nifty. Only in case of a break out beyond 5460 we may see further upside till 5500 and beyond that 5630 is a possibility. Since this is a expiry week we may see a stock specific movement.
Nifty August 2012 futures closed at 5362.40 on Monday at a premium of 12.15 points over spot closing of 5,350.25.
Nifty September 2012 futures were at 5393.10 at a premium of 42.85 points over spot closing.
Nifty August futures saw a contraction of 1.81 million (mn) units taking the total outstanding open interest (OI) to 23.48 mn units.
The India VIX witnesed an addition of 1.92% at 16.47 as compared to its previous close of at 16.16 on Friday.
The Nifty Put Call Ratio (PCR) OI wise stood at 1.79 for August -month contract.
Nifty calls, 5500 SP from the August month expiry was the most active call with contraction of 0.14 million open interest.
Nifty puts, 5300 SP from the August month expiry was the most active put with an addition of 0.32 million open interest.
The maximum OI outstanding for Calls was at 5500 SP (10.57 mn) and that for Puts was at 5300 SP (10.84 mn).
Long positions were witnessed in stocks like MRPL & ULTRACEMCO
Short positions were witnessed in stocks like ADANENT & ORCHIDCHEM
Source: LKP Securities
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