Friday, March 20, 2009

Nifty unstable in 2750 - 2850 range

MUMBAI: In another day of topsy-turvy trade, Indian stock markets ended flat Friday. After opening on negative note led by weak global cues, stocks recovered smartly in late trade as traders covered short positions. NSE’s 50-share Nifty closed the day at 2807.05, down just 0.10 points. The Sensex ended 0.39 per cent lower at 8966. levels. Intraday, Nifty touched a high of 2816.10 and low of 2773.65, a band of 43 points.

Nifty March futures provisionally ended at a discount of 8.5 points against a discount of 7 points on Thursday. The contract price slipped 0.08 per cent while open interest added 22.52 lakh shares. The sell quantity was slightly higher than buy quantity, suggesting slight build up of short positions.

Nifty April futures, on other hand, ended at 12 points discount. The contract price was down just 0.01 per cent while it added 21.72 lakh shares in OI. The discount spread between the two contracts indicates rollover of short positions to the April series.

On options front, call buying was seen at 2800 while call writing at 2900 strikes and unwinding of longs were observed at 3000 strike suggesting strong resistance for Nifty in near term. Huge put writing was seen at 2800 and 2700 strikes while moderate put buying was observed at 2900 strike. The options build up suggests Nifty will remain in 2750-2850 range.

“There is no trigger for markets on domestic front. Nifty will take direction from global cues. With the F&O expiry next Thursday, Nifty will remain in a very tight range with high amount of volatility,” said Anand Sinha, CEO-Spark Advisory.

Among stock futures, Reliance Industries March slipped 0.84 per cent while OI added 9.68 lakh shares. ICICI Bank fell 5 per cent while added 26 lakh shares. Akruti City plunged 27.20 per cent and shed 30000 shares in OI.